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): November 27, 2006

Resource America, Inc.

(Exact name of registrant as specified in its chapter)

Delaware	0-4408	72-0654145
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)
1845 Walnut Street, Suite 1000 Philadelphia, PA		19103
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code: 215-546-5005

(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:

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

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

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

oPre-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 November 27, 2006, Resource America, Inc. (the "Company") issued an earnings release announcing its financial results for the fourth quarter and fiscal year ended September 30, 2006.  A copy of the earnings release is included as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01   Financial Statements and Exhibits

  (c)Exhibits

     99.1 Press Release dated November 27, 2006

SIGNATURES

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, thereunto duly authorized.

	Resource America, Inc.
Date:  November 27, 2006	/s/ Steven J. Kessler Steven J. Kessler Executive Vice President and Chief Financial Officer

EX-99.1

FOR IMMEDIATE RELEASE

CONTACT:           STEVEN KESSLER

CHIEF FINANCIAL OFFICER

RESOURCE AMERICA, INC.

1845 WALNUT STREET, SUITE 1000

PHILADELPHIA, PA 19103

215/546-5005, 215/546-4785 (fax)

RESOURCE AMERICA, INC.

REPORTS OPERATING RESULTS

FOR FOURTH QUARTER AND FISCAL YEAR ENDED SEPTEMBER 30, 2006

Philadelphia, PA November 27, 2006 - Resource America, Inc. (Nasdaq: REXI) (the "Company") reported income from continuing operations of $3.9 million and $17.3 million for the fourth quarter and fiscal year ended September 30, 2006, respectively, as compared to $793,000 and $5.4 million for the fourth quarter and fiscal year ended September 30, 2005, respectively, an increase of $3.1 million (386%) and $11.9 million (220%), respectively. Income from continuing operations per common share-diluted was $0.21 and $0.90 per common share for the fourth quarter and fiscal year ended September 30, 2006, respectively, as compared to income from continuing operations per common share-diluted of $0.04 and $0.28 per common share for the fourth quarter and fiscal year ended September 30, 2005, respectively, an increase of $0.17 (425%) and $0.62 (221%), respectively.

Net income was $4.1 million, or $0.22 per common share-diluted, and $19.9 million, or $1.04 per common share-diluted, for the fourth quarter and fiscal year ended September 30, 2006, respectively, as compared to a net loss of $1.2 million, or $0.06 per common share-diluted, and net income of $16.5 million, or $0.86 per common share-diluted, for the fourth quarter and fiscal year ended September 30, 2005, respectively. Discontinued operations for fiscal 2005 include nine months of operations and spin-off costs related to Atlas America, Inc. (Nasdaq: ATLS), the Company’s former 80% owned energy subsidiary, prior to its tax-free distribution to shareholders on June 30, 2005. The fourth quarter ended September 30, 2005 included $144,000 of spin-off costs while the fiscal year ended September 30, 2005 reflected $16.5 million of Atlas America income from discontinued operations, net of tax, including $2.7 million of spin-off costs. Excluding the operations of Atlas America and related spin-off costs, net loss per common share-diluted would have been $0.05 and $0.00 per common share for the fourth quarter and fiscal year ended September 30, 2005, respectively.

Assets under management increased to $12.1 billion at September 30, 2006 from $7.1 billion at September 30, 2005, an increase of $5.0 billion (70%), as follows:

	At September 30,
	2006		2005
Financial fund management	$	10.6 billion (1)	$	6.1 billion (1)
Real estate		0.9 billion (2)		0.6 billion (2)
Commercial finance		0.6 billion (3)		0.4 billion (3)
	$	12.1 billion	$	7.1 billion

(1)   We value our financial fund management assets at their amortized cost.

(2)   We value our managed real estate assets as the sum of: the amortized cost of our commercial real estate loans; the book value of real estate and other assets held by our real estate investment partnerships and tenant-in-common, or TIC, property interests; the amount of our outstanding legacy loan portfolio; and the book value of our interests in real estate.

(3)   We value our commercial finance assets as the sum of the book value of the equipment and notes financed by us.

Operating income as adjusted, before depreciation and amortization, was $8.8 million and $30.3 million for the fourth quarter and fiscal year ended September 30, 2006, respectively, as compared to $2.7 million and $10.9 million for the fourth quarter and fiscal year ended September 30, 2005, respectively, an increase of $6.1 million (223%) and $19.4 million (179%), respectively. The following reconciles operating income as adjusted to our operating income for the quarters and fiscal years ended September 30, 2006 and 2005 (in thousands):

	Three Months Ended				Years Ended
	September 30,				September 30,
	2006		2005		2006		2005
Operating income	$	8,100	$	1,987	$	27,258	$	8,643
Plus:
Depreciation and amortization		709		738		3,064		2,209
Operating income as adjusted	$	8,809	$	2,725	$	30,322	$	10,852

Management of the Company believes that operating income as adjusted provides additional information with respect to the Company’s ability to meet its debt service, capital expenditures and working capital requirements. This measure is similar to EBITDA, a commonly used measure of a business’ ability to generate cash flow without consideration of its financing structure. EBITDA is widely used by commercial banks, investment bankers, rating agencies and investors in evaluating performance relative to peers and pre-set performance standards. Neither adjusted operating income nor EBITDA are measures of financial performance under GAAP and, accordingly, should not be considered as a substitute for net income or cash flows from operating activities prepared in accordance with GAAP.

Resource America, Inc. is a specialized asset management company that uses industry specific expertise to generate and administer investment opportunities for its own account and for outside investors in the financial fund management, real estate and commercial finance sectors.

For more information, please visit our website at www.resourceamerica.com or contact investor relations at pschreiber@resourceamerica.com.

Highlights for the Fourth Quarter, Fiscal Year Ended September 30, 2006 and Recent Developments

CORPORATE:

·   The Company increased its managed assets to $12.1 billion at September 30, 2006 from $7.1 billion at September 30, 2005 (70%). Additionally, the Company closed two CDOs subsequent to September 30, 2006 (of which $793.0 million was included in our year end assets under management) for which it has been engaged as the collateral manager. These CDOs will begin to generate management fees at the end of the first quarter of fiscal 2007.

·   The Company increased its revenues to $23.3 million and $78.8 million for the fourth quarter and fiscal year ended September 30, 2006, respectively, an increase of $10.8 million (87%) and $31.7 million (67%) from the fourth quarter and fiscal year ended September 30, 2005, respectively.

·   The Company repurchased 61,079 shares of its common stock for $1.2 million at an average price of $19.39 in the fourth quarter ended September 30, 2006 and 820,559 shares of its common stock for $14.6 million at an average price of $17.84 for the fiscal year ended September 30, 2006.

·   As of September 30, 2006, the Company employed 224 full-time workers (including 76 investment professionals), an increase of 70, or 45%, from 154 employees (including 51 investment professionals) at September 30, 2005.

·   The Company increased its cash balance by $7.3 million to $37.6 million at September 30, 2006 from $30.4 million at September 30, 2005. Additionally, $8.1 million and $5.0 million of cash was held in escrow accounts at September 30, 2006 and 2005, respectively.

FINANCIAL FUND MANAGEMENT:

·   The Company’s financial fund management division increased its assets under management to $10.6 billion at September 30, 2006, an increase of $4.5 billion (73%) from September 30, 2005.

·   Financial fund management revenues increased to $30.8 million for the fiscal year ended September 30, 2006 from $15.9 million (94%) for the fiscal year ended September 30, 2005.

·   Apidos Capital Management, LLC (“Apidos”), the Company’s wholly-owned subsidiary focusing on investing in financing, structuring and managing bank loans, increased it managed assets to $1.9 billion at September 30, 2006 from $413.4 million (366%) at September 30, 2005.

·   Ischus Capital Management, LLC (“Ischus”), the Company’s wholly-owned subsidiary focusing on investing in financing, structuring and managing asset-backed securities, including residential mortgage-backed and commercial mortgage-backed securities, increased its managed assets to $4.4 billion at September 30, 2006 from $2.8 billion (56%) at September 30, 2005.

·   Trapeza Capital Management (“Trapeza”), the Company’s fund manager that originates, structures, finances and manages trust preferred securities and senior debt securities of banks, bank holding companies, insurance companies and other financial companies, increased its managed assets to $4.2 billion at September 30, 2006 from $2.9 billion (46%) at September 30, 2005.

REAL ESTATE:

·   Resource Real Estate Holdings, Inc. (“RRE”), the Company’s real estate asset manager that invests in and manages investment vehicles that manage real estate assets and operates the Company’s commercial real estate debt platform, increased its assets under management to $883.7 million at September 30, 2006, an increase of $264.9 million (43%) from September 30, 2005. Excluding assets managed in our legacy portfolio, RRE’s assets under management increased by $496.0 million (172%) to $784.5 million at September 30, 2006 from $288.5 million at September 30, 2005.

·   Commercial real estate debt portfolio managed on behalf of Resource Capital Corp. grew to $439.7 million at September 30 , 2006 from $86.9 million (406%) at September 30, 2005.

·   RRE revenues increased to $23.7 million for the fiscal year ended September 30, 2006 from $17.8 million (33%) for the fiscal year ended September 30, 2005. The fiscal year ended September 30, 2006 included the sale of a partial interest in a real estate venture, resulting in a $4.2 million gain. In the fiscal year ended September 30, 2005, we realized a gain of $6.3 million from refinancing the mortgage on this investment.

·   RRE resolved loans with a combined book value of $43.9 million, realizing $43.6 million in net proceeds during the fiscal year ended September 30, 2006.

COMMERCIAL FINANCE:

·   LEAF Financial Corporation (“LEAF”), the Company’s commercial finance asset manager, increased its lease and note originations to $423.6 million for the fiscal year ended September 30, 2006, an increase of $172.8 million (69%) from the fiscal year ended September 30, 2005.

·   Commercial finance assets under management increased to $612.7 million at September 30, 2006, an increase of $273.0 million (80%) from September 30, 2005.

·   LEAF II, a publicly-registered partnership managed by LEAF on behalf of individual investors, completed its public offering on October 13, 2006 after having raised the maximum of $60.0 million under its registration statement.

·   LEAF’s revenues increased to $23.8 million for the fiscal year ended September 30, 2006 from $13.4 million (78%) for the fiscal year ended September 30, 2005.

·   LEAF entered into a $150.0 million revolving warehouse credit facility with a group of banks led by National City Bank.

·   LEAF filed a $120.0 million registration statement with the Securities Exchange Commission on October 2, 2006 for LEAF III.

RESOURCE EUROPE:

·   In April 2006, the Company commenced its European leveraged loan operations, Resource Europe, based in London, England, and hired Rob Reynolds and four other professionals to manage and develop these operations.

·   As of November 21, 2006, Resource Europe managed €100.0 million of bank loan assets.

Statements made in this release include forward-looking statements, which involve substantial risks and uncertainties. The Company’s actual results, performance or achievements could differ materially from those expressed or implied in this release. For information pertaining to risks relating to these forward-looking statements, reference is made to the section “Risk Factors” contained in Item 1 of the Company’s Annual Report on Form 10-K.

The remainder of this release contains the Company’s consolidated balance sheets, consolidated statements of operations and consolidated statements of cash flows.

RESOURCE AMERICA, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

	September 30,
	2006			2005
ASSETS
Cash	$	37,622		$	30,353
Restricted cash		8,103			5,000
Accounts receivable		1,847			10,677
Receivables from managed entities		8,795			4,280
Investments in commercial finance		108,850			41,394
Assets held for sale		1,312			107,520
Loans held for investment		69,314			97,752
Investments in real estate		50,104			46,049
Investment securities available-for-sale		64,857			38,353
Investments in unconsolidated entities		26,626			24,564
Property and equipment, net		9,525			30,521
Deferred income taxes		6,408			7,086
Other assets		23,390			15,486
Total assets	$	416,753		$	459,035
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	12,448		$	7,794
Accrued expenses and other liabilities		14,341			16,835
Payables to managed entities		1,579			591
Liabilities associated with assets held for sale		1,145			74,438
Borrowings		172,238			147,302
Deferred revenue		1,592			1,239
Deferred income tax liabilities		10,746			7,086
Minority interests		9,602			16,614
Total liabilities		223,691			271,899
Commitments and contingencies		−			−
Stockholders’ equity:
Preferred stock, $1.00 par value, 1,000,000 shares authorized; none outstanding		-			-
Common stock, $.01 par value, 49,000,000 shares authorized; 26,401,708 and 26,371,780 shares issued, respectively		264			264
Additional paid-in capital		259,882			258,019
Retained earnings		25,464			9,845
Treasury stock, at cost; 9,110,290 and 8,312,760 shares, respectively		(96,960	)		(82,556	)
ESOP loan receivable		(465	)		(488	)
Accumulated other comprehensive income		4,877			2,052
Total stockholders’ equity		193,062			187,136
	$	416,753		$	459,035

RESOURCE AMERICA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

	Three Months Ended						Years Ended
	September 30,						September 30,
	2006			2005			2006			2005
	(unaudited)
REVENUES:
Financial fund management	$	10,165		$	5,036		$	30,834		$	15,944
Real estate		5,316			3,253			23,676			17,791
Commercial finance		7,357			4,191			23,840			13,381
Resource Europe		474			−			474			−
		23,312			12,480			78,824			47,116
COSTS AND EXPENSES:
Financial fund management		3,769			3,257			11,104			9,110
Real estate		3,857			1,861			12,122			9,903
Commercial finance		4,061			1,908			14,443			8,884
Resource Europe		566			−			995			−
General and administrative		2,250			2,729			9,838			8,367
Depreciation and amortization		709			738			3,064			2,209
		15,212			10,493			51,566			38,473
OPERATING INCOME		8,100			1,987			27,258			8,643
OTHER INCOME (EXPENSE):
Interest expense		(4,560	)		(1,288	)		(10,119	)		(2,811	)
Minority interest.		(539	)		(245	)		(1,775	)		(1,403	)
Other income, net		1,510			762			5,154			4,550
		(3,589	)		(771	)		(6,740	)		336
Income from continuing operations before taxes and cumulative effect of a change in accounting principle		4,511			1,216			20,518			8,979
Provision for income taxes		657			423			3,236			3,591
Income from continuing operations before cumulative effect of a change in accounting principle		3,854			793			17,282			5,388
Income (loss) from discontinued operations, net of tax		254			(1,974	)		1,231			11,070
Cumulative effect of a change in accounting principle, net of tax		−			−			1,357			−
NET INCOME (LOSS)	$	4,108		$	(1,181	)	$	19,870		$	16,458
Basic earnings (loss) per common share:
Continuing operations	$	0.22		$	0.04		$	0.98		$	0.30
Discontinued operations		0.02			(0.11	)		0.07			0.63
Cumulative effect of accounting change		−			−			0.08			−
Net income (loss)	$	0.24		$	(0.07	)	$	1.13		$	0.93
Weighted average shares outstanding		17,329			18,112			17,627			17,696
Diluted earnings (loss) per common share:
Continuing operations	$	0.21		$	0.04		$	0.90		$	0.28
Discontinued operations		0.01			(0.10	)		0.07			0.58
Cumulative effect of accounting change		−			−			0.07			−
Net income (loss)	$	0.22		$	(0.06	)	$	1.04		$	0.86
Weighted average shares outstanding		18,915			20,437			19,121			19,204
Dividends declared per common share	$	0.06		$	0.05		$	0.24		$	0.20

RESOURCE AMERICA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Years Ended September 30,
	2006			2005 (1)			2004 (1)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	19,870		$	16,458		$	18,409
Adjustments to reconcile net income to net cash used in operating activities:
Cumulative effect of a change in accounting principle, net of tax		(1,357	)		−			−
Depreciation and amortization		3,180			2,247			1,696
Equity in earnings of unconsolidated entities		(8,747	)		(7,807	)		(8,679	)
Minority interest earnings		1,775			1,403			−
Distributions from unconsolidated entities		12,570			13,899			7,041
Income from discontinued operations		(1,231	)		(11,070	)		(16,799	)
Gain on sale of investment securities available-for-sale		(668	)		(1,544	)		(9,453	)
(Gain) loss on asset dispositions		(7,715	)		(7,781	)		3,802
Deferred income tax (benefit) provision		(3,120	)		3,591			1,127
Non-cash compensation on long-term incentive plans		1,739			1,251			753
Non-cash compensation issued		2,396			−			−
Non-cash compensation received		(1,844	)		(1,839	)		−
Tax benefit from exercise of stock options		−			2,517			121
Increase in net assets of FIN 46 entities		−			(2,922	)		(717	)
Increase in commercial finance investments		(68,376	)		(17,886	)		(16,720	)
Changes in operating assets and liabilities		12,474			(9,471	)		6,894
Net cash used in operating activities of continuing operations		(39,054	)		(18,954	)		(12,525	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(4,141	)		(2,414	)		(1,604	)
Payments received on real estate loans and real estate		42,058			7,417			26,441
Investments in real estate		(33,004	)		(16,753	)		(6,619	)
Return of capital from investments in unconsolidated entities		−			9,390			−
Purchases of investment securities available-for-sale		(34,820	)		(26,800	)		(10,372	)
Proceeds from sales of investment securities available-for-sale		7,205			5,038			20,170
Increase in restricted cash		(3,103	)		(5,000	)		−
Dividends received from Atlas America		−			−			52,133
(Increase) decrease in other assets		(13,821	)		321			12,066
Net cash (used in) provided by investing activities of  continuing operations		(39,626	)		(28,801	)		92,215

RESOURCE AMERICA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS − (Continued)

(in thousands)

	Years Ended September 30,
	2006			2005 (1)			2004 (1)
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in borrowings	$	570,448		$	267,643		$	142,857
Increase in principal payments on borrowings		(501,088	)		(258,865	)		(233,097	)
Investor contributions to financial fund management investments		−			10,410			−
Dividends paid		(4,251	)		(3,533	)		(2,619	)
Proceeds from issuance of stock		133			5,819			613
Purchase of treasury stock		(14,642	)		(5,179	)		−
Tax benefit from exercise of stock options		231			−			−
Other		−			(1,660	)		(197	)
Net cash provided by (used in) financing activities of continuing operations		50,831			14,635			(92,443	)
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Operating activities		1,771			23,566			35,214
Investing activities		37,172			−			−
Net cash provided by discontinued operations		38,943			23,566			35,214
Net cash retained by entities previously consolidated		(3,825	)		−			−
Increase (decrease) in cash		7,269			(9,554	)		22,461
Cash at beginning of period		30,353			39,907			17,446
Cash at end of period	$	37,622		$	30,353		$	39,907

(1)Revised presentation to reflect detail of cash flows from discontinued operations.

Reconciliation of Net Cash (Used In) Operating Activities of Continuing Operations to Net Cash Provided By Operating Activities of Continuing Operations, As Adjusted

Net cash provided by operating activities of continuing operations, as adjusted was $20.8 million for the fiscal year ended September 30, 2006, an increase of $9.5 million (84%) as compared to $11.3 million for the fiscal year ended September 30, 2005. The following reconciles net cash provided by continuing operations, as adjusted to net cash (used in) operating activities of continuing operations for the fiscal years ended September 30, 2006 and 2005, respectively (in thousands):

	Fiscal Years Ended
	September 30,
	2006			2005
Net cash (used in) operating activities of continuing operations	$	(39,054	)	$	(18,954	)
Adjustments:
Increase in commercial finance investments		68,376			17,886
Changes in operating assets and liabilities		(12,474	)		9,471
Cash proceeds from the sale of a partial partnership interest		4,000			−
Increase in net assets of FIN 46 entities		−			2,922
Net cash provided by operating activities of continuing operations, as adjusted	$	20,848		$	11,325