The fund’s second largest detractor during the quarter was Knowles Corp. (NYSE:KN) which declined over 27 percent and cost the Fund 62 basis points of performance during the quarter. The supplier of acoustic solutions to the mobile communications industry, and former spin-off of Dover Corp., continues to be a challenging position for the firm. Although earnings exceeded expectations due to a lower tax rate, the company lowered guidance despite getting back on the Apple iPhone 6S platform. Additionally, specialty component sales in the wireless base station business were weaker due to lower telecom cap ex, mainly in China, and more recent concerns of depressed demand for smartphones have pressured the stock. Looking out into 2016, the China telecom spend is expected to rebound, the Audience acquisition should become accretive and the company should further increase market share on the iPhone 7.
From the Keeley All Cap Value Fund 4th quarter 2015 shareholder letter.
