BlackRock Inc's fourth-quarter earnings report gave investors an indication of the jolt the world's biggest asset manager may get from its move into exchange-traded funds following its December 1 acquisition of Barclays Global Investors.
Net income rose to $256 million, or $1.62 a share, from $52 million, or 39 cents a share, a year earlier.
Excluding special items, BlackRock said profit increased to $2.39 a share from 66 cents. On that basis, the results surpassed the analysts' average forecast of $2.10, according to Thomson Reuters I/B/E/S.
Revenue rose 45 percent to $1.54 billion, including $278 million in fees generated from BGI in December, the company said.
With $3.3 trillion in assets under management, BlackRock now manages more money than the entire hedge fund industry following the BGI deal.
But BlackRock also incurred $152 million in added expenses because of the transaction and the integration of the ETF business. Fourth-quarter operating expenses tallied $1.16 billion, up from $726 million a year earlier.
In acquiring BGI, New York-based BlackRock added 3,500 new employees and now has more staff in London than anywhere else in the world.
Notwithstanding our early accomplishments, we are under no illusion: Integrations are hard and we have a great deal of work ahead, BlackRock Chief Executive Officer Laurence Fink said in the earnings release.
The company's BlackRock Solutions business took on 14 new assignments in the fourth quarter. The unit has emerged as a major advisor to the U.S. Federal Reserve on a number of government bailouts, including the controversial rescue package for American International Group.
BlackRock said the new jobs for BlackRock Solutions reflect a continued focus on risk management by investors and institutions.
(Reporting by Matthew Goldstein; Editing by Lisa Von Ahn)