8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 28, 2007

ALLIN CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Delaware	0-21395	25-1795265
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

381 Mansfield Avenue, Suite 400, Pittsburgh, Pennsylvania	15220
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (412) 928-8800

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On February 28, 2007, Allin Corporation issued a press release announcing its financial results for the three- and twelve-month periods ended December 31, 2006. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information included in the attached exhibit and contained in Item 2.02 of this Current Report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly incorporated by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit No.	Description of Exhibit
99.1	Press Release dated February 28, 2007

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ALLIN CORPORATION
Dated: March 2, 2007	By:	/s/ Dean C. Praskach
		Chief Financial Officer

Exhibit Index

Exhibit No.	Description
99.1	Press release dated February 28, 2007

EX-99.1

Exhibit 99.1

News Release

Allin Corporation 381 Mansfield Avenue Suite 400 Pittsburgh, Pennsylvania 15220-2751                 Telephone:                 (412) 928-2022                 Telefax:                 (412) 928-0225

Allin Corporation Announces Record Year-End Earnings

Wednesday, February 28, 2007

For Release at 4:30 PM EST

Pittsburgh, PA: Allin Corporation (OTCBB: ALLN), a Microsoft Gold Certified technology consulting company, today reported results for the three months and twelve months ended December 31, 2006.

For the three-month and twelve-month periods ended December 31, 2006, revenue was $4.0 million and $19.0 million, respectively, compared to $3.7 million and $14.3 million for the three-month and twelve-month periods ended December 31, 2005, respectively. The Company recorded net income attributable to common shareholders in the amount of $336,000 ($0.03 per share - diluted) for the three-month period ended December 31, 2006 and $599,000 ($0.06 per share - diluted) for the twelve-month period ended the same date. The 2006 results compare with a net loss attributable to common shareholders of $979,000 ($0.13 per share) and $1.9 million ($0.26 per share) for the three-month and twelve-month periods ended December 31, 2005, respectively.

“We are very pleased to be able to report record earnings for the year,” stated Rich Talarico, Allin’s chief executive officer. “The results reflect strong growth in every revenue category. In particular, we experienced solid revenue growth in our travel and leisure and financial services vertical markets as well as more broadly in custom application development and services offered around the Microsoft Dynamics suite of products. The growth of the Company’s revenue from the travel and leisure industry reflects a rebound in ship orders by the Company’s interactive media clients. The release schedule for our existing clients is fairly strong over the next few years and, in the latter part of 2006, we added three new cruise line clients. The financial services sector is served primarily through our Boston office, which we acquired in July 2005. This office has done a good job of expanding both its client and revenue base since the acquisition. We believe that 2007 can be a strong year for the Company. The release schedule for Microsoft’s product line should drive services revenue and our backlog of signed business is strong in both the travel and leisure and the financial services vertical markets for the year. Barring an unforeseen turn in the economy, we are confident that we will be able to produce good revenue growth for 2007. Based on the sailing dates for new cruise vessels for which we have interactive media orders, we expect the first half, and especially the first quarter, to be the strongest part of the year.”

Total revenue increased $4.7 million or 33% comparing the full year ended December 31, 2006 with the year ended December 31, 2005. Consulting Services revenue increased $2.7 million or 24% comparing the full year periods ended December 31, 2006 and 2005. The increase in Consulting Services

revenue was driven by business intelligence and custom application development using tools such as Microsoft .NET, Microsoft Business Scorecard Manager, Microsoft SQL Server 2005 and SharePoint as well as larger and more complex Microsoft Dynamics and CRM implementations and the inclusion of a full year of operations for the Boston office. Systems Integration revenue grew by $1.6 million or 143% comparing the full year 2006 with the full year 2005 due primarily to a rebound in new ship orders by the Company’s interactive media clients. Every new vessel that has been completed for an existing cruise line client has sailed with an Allin interactive media system aboard. Revenue from Information System Product Sales increased 20% to $1.3 million for the full year 2006 compared to the full year 2005 primarily due to an increase in sales of the Microsoft Dynamics suite of software.

Gross profit increased $2.4 million or 31% comparing the year ended December 31, 2006 with the year ended December 31, 2005. Total selling, general and administrative expenses increased $580,000 million or 6.6% comparing the full year 2006 with the full year 2005.

The net income attributable to common shareholders of $599,000 for the year ended December 31, 2006 was bolstered by the inclusion of a benefit from income tax in the amount of $990,000, which was attributable to a reduction in the valuation allowance against the Company’s deferred tax assets related to net operating losses. The change in the valuation allowance was made due to the strength of the Company’s 2006 results, the backlog of signed business that the Company has for 2007 and due in part to the new ship build schedule for the Company’s clients for 2008 and 2009. The benefit obtained from the reduction of the valuation allowance was offset to a certain degree by an increase in the dividends on the Company’s preferred stock of $361,000 comparing the year ended December 31, 2006 with the prior year.

About Allin Corporation

Allin Corporation is a leading provider of solutions-oriented application development and technology infrastructure consulting and systems integration services. Allin specializes in Microsoft-based technologies and was recently recognized as Microsoft’s East Region Partner of the Year. Allin’s operations are centered on four practice areas: Technology Infrastructure, Collaborative Solutions, Business Process and Interactive Media. Allin leverages its experience in these areas to work with clients through a disciplined project delivery framework to ensure that solutions are delivered on time and on budget. Allin delivers these services through the trade names Allin Consulting, Allin Interactive and the CodeLab Technology Group. The Company maintains offices in Pittsburgh, Pennsylvania; Ft. Lauderdale, Florida; Wakefield, Massachusetts; and San Jose and Walnut Creek, California. For additional information about Allin, visit the Company’s Internet sites on the World Wide Web at http://www.allin.com and http://www.codelabtech.com/.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to the safe harbors created thereby. These

forward-looking statements are based on current expectations and projections about future events and financial trends. The words or phrases “believe,” “will,” “expect,” “should” and similar words or expressions are intended to identify forward-looking statements. In addition, any statements that refer to expectations or other characterizations of future events or circumstances are forward-looking statements. The forward-looking statements are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those described in the forward-looking statements, including, among other things, a concentration in the Company’s revenue from certain services and clients, a limited backlog, the Company’s ability to expand its markets, limited financial resources, dependence on key personnel, the integration of acquired businesses and competitive market conditions. These are representative of factors which could affect the outcome of the forward-looking statements. In addition, such statements could be affected by general industry and market conditions and growth rates, general domestic and international economic conditions and future incidents of terrorism or other events that may negatively impact the markets in which the Company competes. The Company undertakes no obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise.

CONTACT:	Dean C. Praskach	Phone:	(412) 928-2022
	Chief Financial Officer	Telefax:	(412) 928-0225
	Allin Corporation	E-mail:	Dean.Praskach@allin.com

ALLIN CORPORATION & SUBSIDIARIES

SELECTED FINANCIAL DATA

(Dollars in thousands, except for per share data)

The selected financial data for each of the periods ended December 31, 2006 and 2005, presented below, have been derived from the consolidated financial statements of the Company.

	Three Months Ended						Twelve Months Ended
	December 31, 2006			December 31, 2005			December 31, 2006			December 31, 2005
	Unaudited			Unaudited			Audited			Audited
Revenue
Consulting Services	$	3,114		$	3,197		$	13,819		$	11,160
Systems Integration		223			111			2,647			1,089
Information System Product Sales		410			169			1,262			1,048
Other Services		256			251			1,320			1,006
Total revenue		4,003			3,728			19,048			14,303
Cost of sales		2,005			1,683			8,730			6,427
Gross profit		1,998			2,045			10,318			7,876
Selling, general & administrative		2,196			2,162			9,012			7,851
Loss on impairment or disposal of assets		1			484			4			631
Depreciation & amortization		103			114			405			359
Total selling, general & administrative		2,300			2,760			9,421			8,841
(Loss) income from operations		(302	)		(715	)		897			(965	)
Interest expense (income), net		4			(8	)		14			(6	)
(Benefit) from income taxes		(992	)		0			(977	)		(5	)
Net income (loss)		686			(707	)		1,860			(954	)
Accretion and dividends on preferred stock		350			272			1,261			900
Net income (loss) attributable to common shareholders	$	336		$	(979	)	$	599		$	(1,854	)
Earnings (loss) per common share – basic	$	0.04		$	(0.13	)	$	0.08		$	(0.26	)
Earnings (loss) per common share – diluted	$	0.03		$	(0.13	)	$	0.06		$	(0.26	)
Weighted average shares outstanding – basic		7,809,327			7,467,339			7,553,539			7,185,147
Weighted average shares outstanding – diluted		12,272,545			7,467,339			12,017,383			7,185,147

	December 31, 2006		December 31, 2005
	Audited		Audited
Balance Sheet
Current Assets:
Cash and Cash Equivalents	$	369	$	1,531
Other Current Assets		5,577		3,805
Total Current Assets		5,946		5,336
Other Assets		7,302		5,027
Total Assets	$	13,248	$	10,363
Current Liabilities
Bank Line of Credit		-0-		-0-
Other Current Liabilities		4,848		6,084
Other Liabilities		3,357		57
Shareholder’s Equity		5,043		4,222
Total Liabilities and Shareholder’s Equity	$	13,248	$	10,363