Envestnet, the wealth management software provider which recently announced it was buying Tamarac, reported net income of $1.8 million for the fourth quarter 2011, a rise of 111 per cent year-over-year.

For the full year, net income attributable to common shareholders was $7.6 million, compared to a $1 million net loss a year earlier.

Total revenues during the fourth quarter rose 11 per cent to $30.5 million, primarily due to a 12 per cent increase in revenues from assets under management or administration, which were $24.6 million, the firm said. Total operating expenses increased 10 per cent to $28.1 million.

Cost of revenues increased 11 per cent to $10.4 million in Q4; compensation and benefits dipped 2 per cent to $9.6 million, and general and administration costs expanded 22 per cent to $6.0 million.

For the full year, total revenues, including from AuM/AuA, and licensing and professional services fees, rose 26 per cent to hit $123.2 million.

“We delivered strong growth in revenue from assets under management or administration during 2011,” said Jud Bergman, founder and chief executive of Envestnet.

“Deepening our existing advisor relationships will be core to our growth strategy in 2012, with opportunities to accelerate that growth through strategic activity that leverages our scale, expands our investment capabilities, and broadens the software tools that enable advisors to build their business efficiently.”

Envestnet entered into an agreement earlier this month to purchase the RIA-focused technology firm Tamarac for a cash sum of $54 million. The acquisition is expected to close within the first half of 2012.

“We value [Tamarac’s] market position within the independent RIA segment which is core to Envestnet’s growth initiatives,” said Bergman at the time.

Assets under management ended the year at $22.9 billion at Envestnet, up 58 per cent from the end of 2010. Assets under administration dropped 4 per cent to $47.1 billion. Advisors (assets under management/administration only) served totaled 13,887.

During the final quarter the firm closed its acquisition of FundQuest. “At that time, $5.8 billion of FundQuest assets previously reported by the company as AuA were reclassified to AuM. Also during the fourth quarter, one of FundQuest’s clients with $1.5 billion in assets transitioned to licensing for a flat fee and is no longer reflected in the company’s AuA” at year-end, Envestnet said in its results.