LKCM Funds N-CSRS Certified semi-annual shareholder report (management investment company)

As filed with the Securities and Exchange Commission on 8-31-2018

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-8352

LKCM Funds

(Exact name of registrant as specified in charter)

c/o Luther King Capital Management Corporation

301 Commerce Street, Suite 1600

Fort Worth, TX 76102

(Address of principal executive offices) (Zip code)

K&L Gates LLP

1601 K Street, NW

Washington, DC 20006

(Name and address of agent for service)

1-800-688-LKCM and 1-800-423-6369

Registrant’s telephone number, including area code

Date of fiscal year end: December 31

Date of reporting period: June 30, 2018

Item 1. Report to Stockholders.

LKCM

FUNDS

LKCM Small Cap Equity Fund

LKCM Small-Mid Cap Equity Fund

LKCM Equity Fund

LKCM Balanced Fund

LKCM Fixed Income Fund

Semi-Annual Report

June 30, 2018

Dear Fellow Shareholders:

We report the following performance information for the LKCM Funds for indicated periods ended June 30, 2018:

Funds	Inception Dates		NAV @ 6/30/18		Net Expense Ratio*, **		Gross Expense Ratio**		Six Month Total Return Ended 6/30/18		One Year Total Return Ended 6/30/18		Five Year Average Annualized Return Ended 6/30/18		Ten Year Average Annualized Return Ended 6/30/18		Avg. Annual Total Return Since Incept.
LKCM Equity Fund -
Institutional Class		1/3/96	$	27.37		0.81%		1.00%		5.19%		16.04%		11.27%		10.02%		8.69%
S&P 500 Index(1)										2.65%		14.37%		13.42%		10.17%		8.82%
LKCM Small Cap Equity Fund -
Institutional Class		7/14/94	$	20.37		1.00%		1.10%		10.47%		20.75%		9.29%		9.14%		10.70%
Russell 2000 Index(2)										7.66%		17.57%		12.46%		10.60%		9.73%
LKCM Small Cap Equity Fund -
Adviser Class		6/5/03	$	18.91		1.25%		1.35%		10.39%		20.41%		9.02%		8.87%		9.67%
Russell 2000 Index(2)										7.66%		17.57%		12.46%		10.60%		10.32%
LKCM Small-Mid Cap Equity Fund -
Institutional Class		5/2/11	$	11.23		1.00%		1.76%		5.94%		21.95%		9.11%		N/A		7.02%
Russell 2500 Index(3)										5.46%		16.24%		12.29%		N/A		11.03%
LKCM Balanced Fund		12/30/97	$	22.45		0.80%		1.02%		1.69%		8.19%		8.70%		8.41%		6.56%
S&P 500 Index(1)										2.65%		14.37%		13.42%		10.17%		7.15%
Bloomberg Barclays Capital U.S. Intermediate Government/Credit Bond Index(4)										-0.97%		-0.58%		1.60%		3.08%		4.38%
LKCM Fixed Income Fund		12/30/97	$	10.48		0.50%		0.80%		-0.81%		-0.28%		1.51%		3.47%		4.19%
Bloomberg Barclays Capital U.S. Intermediate Government/Credit Bond Index(4)										-0.97%		-0.58%		1.60%		3.08%		4.38%

Performance data quoted represents past performance and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance of the Funds may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-800-688-LKCM. The Funds impose a 1.00% redemption fee on shares held less than 30 days. If reflected, the fee would reduce performance shown.

* Luther King Capital Management Corporation, the Funds’ investment adviser, has contractually agreed to waive all or a portion of its management fee and/or reimburse expenses of each Fund to maintain designated expense ratios through May 1, 2019. This expense limitation excludes interest, taxes, brokerage commissions, indirect fees and expenses related to investments in other investment companies, including money market funds, and extraordinary expenses. Investment performance reflects fee waivers, if any, in effect during the relevant period. In the absence of such waivers, total return would be reduced. Investment performance is based upon the net expense ratio. LKCM waived management fees and/or reimbursed expenses for each Fund during the six months ended June 30, 2018.

** Expense ratios above are as of May 1, 2018, as reported in the Funds’ current prospectus. Expense ratios reported for other periods in the financial highlights of this report may differ.

(1) The S&P 500^® Index is an unmanaged capitalization-weighted index of 500 selected stocks that is generally considered representative of the performance of large capitalization companies in the U.S. stock market.

(2) The Russell 2000^® Index is an unmanaged index which measures the performance of the 2,000 smallest companies in the Russell 3000^® Index.

(3) The Russell 2500^® Index is an unmanaged index which measures the performance of the 2,500 smallest companies in the Russell 3000^® Index.

(4) The Bloomberg Barclays U.S. Intermediate Government/Credit Bond Index is an unmanaged market value weighted index measuring both the principal price changes of, and income provided by, the underlying universe of securities that comprise the index. Securities included in the index must meet the following criteria: fixed as opposed to variable rate; remaining maturity of one to ten years; minimum outstanding par value of $250 million; rated investment grade or higher by Moody’s Investors Service or equivalent; must be dollar denominated and non-convertible; and must be publicly issued.

Note: The indices defined above are not available for direct investment and the index performance therefore does not include fees, expenses or taxes.

1H2018 Review and Outlook

For much of the past year “synchronized global growth” has been an apt description of the global economy. With an economic growth tailwind, central bankers in the U.S., Europe, and Japan have been keen to withdraw overly-accommodative monetary policy in anticipation of the next economic downturn. More recently, however, economic growth outside the U.S. appears to be decelerating, making the reduction of accommodative monetary policy more of a risk for global growth. The ability of global economic growth to resynchronize appears to be made more uncertain by the presence of rising protectionism related to trade. For the moment, the U.S. increasingly appears to be the primary engine of global economic growth. Following an annualized rate of 2.0% growth in real Gross Domestic Product (GDP) in the first quarter of 2018, GDP grew by annualized rate of 4.1% in the second quarter of 2018.

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Increasingly, investor focus appears to have shifted towards emerging market economies, which had benefited significantly in recent years from broad global growth. In recent years, these markets have revived global trade, manufacturing, and commodity prices. Despite more restrictive monetary policy, particularly in the U.S., the value of the U.S. dollar fell last year, aiding emerging market debt denominated in U.S. dollars. Recently, however, we believe the positive backdrop for emerging markets appears to have deteriorated with a rising U.S. dollar, slowing global growth, and greater protectionism.

Domestically, we believe the U.S. economy has yet to feel the full impact of fiscal stimulus. We believe the sustainability of a fiscally-induced economic expansion largely will depend on the prospect for productivity-increasing investments, which would lift the economy’s growth potential. There are specific provisions of the 2017 tax legislation which target accelerated investment by companies, and our outlook for productivity-enhancing capital expenditures remains positive, as we believe this is increasingly important to sustained economic growth. We believe that late cycle stimulative fiscal policy in the form of lower tax rates supports above-trend economic growth, but this stimulus occurs at a time when the economy’s excess capacity appears to have shrunk considerably. This combination could well result in inflationary wage pressure and rising input costs for companies.

The rate of economic growth in the U.S. rose during the second quarter of 2018 in contrast to the softening of the other remaining ten largest global economies during the same period. A similar slowing of global economic growth occurred in 2015 and caused the Federal Reserve to slow its intended pace of monetary tightening. In contrast, the Federal Reserve is unlikely in our view to abandon its current plans which call for two additional interest rate increases of 0.25% each later this year. The economic output gap, or the difference between economic output and potential economic output, has narrowed over the past two years. As a result, we believe the U.S. economy no longer has spare capacity. When taken in tandem with a 48-year low in the unemployment rate of 3.75% in May 2018, it is unlikely in our view that the Federal Reserve will slow its pace of monetary tightening. As a result, we believe the risk of a monetary policy error, or over-tightening in a slowing economy, has risen. We believe this risk is particularly true if economic growth outside the U.S. continues to slow or there is a further escalation of tariffs.

The degree to which the U.S. should be concerned over its existing trade deficit has quickly become a central economic question in our view. One line of reasoning is that the current trade deficit, which is the result of importing more goods than our country exports, has led to less domestic manufacturing and therefore fewer manufacturing jobs. The Trump administration has elected to erect new tariffs or raise the level of existing tariffs in an effort to level the playing field and protect domestic manufacturing. The inherent challenge is that countries impacted by newly enacted U.S. tariffs are naturally inclined to react in kind by altering their trade policies. This process is made more complex since it is difficult to calibrate the impact of trade tariffs, and the economic impact is not linear. This concept is highlighted by the complex web known as the global manufacturing supply chain. China, for example, assembles a great number of goods comprised of components imported from other countries, such as memory chips and digital displays. If Chinese imports were to experience a 10% decline, we believe Taiwan, Malaysia, and South Korea would suffer a markedly larger blow to their domestic economies relative to China.

The Trump administration’s protectionist rhetoric appears to have a three-pronged purpose. First, it was evident early in his presidential campaign that President Trump intended to defend U.S. manufacturing. Second, the administration appears to view the North American Free Trade Agreement (NAFTA) as less favorable to the U.S. than to Mexico or Canada. Finally, it is apparent there are increasing concerns by the administration over the theft of U.S. corporate intellectual property. In our view, the pursuit of trade protectionism on a larger scale would eventually trim domestic economic growth and create detrimental knock-on effects such as lowering business confidence at a time the economy needs further productivity-enhancing capital investment.

We believe the U.S. economy remains on its gradual progression through a typical business cycle, albeit longer than average, as the underpinnings remain solid in our view. However, late-cycle dynamics such as tighter labor markets appear to have begun to push wages higher, allowing the Federal Reserve to remain on the path to tighter monetary policy. The effect is a traditional flattening of the yield curve that has resulted over the past year. Meanwhile, other late-cycle warning flags, such as deteriorating credit conditions reflected by widening credit spreads, are not yet evident in our view. Similarly, we believe pressure from rising wages to date is not compressing corporate profit margins, which is typical of a mature business cycle. In our view, the later stages of the business cycle are usually reflected in the equity market by a narrowing of market leadership, with investors bidding growth stocks higher in pursuit of continued growth as the broad economy begins to cool.

LKCM Equity Fund

The LKCM Equity Fund returned 5.19% for the six months ended June 30, 2018 which outpaced the return of 2.65% for the Fund’s benchmark, the S&P 500^® Index, for the same period. The Fund benefited from being underweight the Consumer Staples sector relative to the benchmark, although overweight positions in the Industrials and Materials sectors and an underweight position in the Information Technology sector detracted from the Fund’s relative performance. Positive stock selection in the Industrials, Financials and Consumer Discretionary sectors enhanced the Fund’s returns during the first half of 2018. We believe the Fund is well positioned with its continued emphasis on higher quality companies that we believe are reasonably valued relative to their earnings growth rates, and we anticipate the Fund’s holdings will demonstrate continued improvement from any economic expansion during the second half of this year.

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LKCM Balanced Fund

The LKCM Balanced Fund returned 1.69% for the six months ended June 30, 2018 against the 2.65% return for the S&P 500^® Index and the -0.97% return for the Bloomberg Barclays Intermediate Government/Credit Bond Index. Both the equity and fixed income portfolios of the Fund generated strong returns relative to their benchmarks during the first half of 2018. Stock selection in the Industrials and Materials sectors added to the Fund’s relative performance during the first half of 2018 as investor focus shifted towards companies that are likely to benefit from improving economic conditions. Stock selection in the Financials, Energy and Healthcare sectors was also solid during the first half of 2018. The rise in interest rates during the first half of 2018 created a challenging environment for fixed income investors, as reflected by the negative return of the Bloomberg Barclays Intermediate Government/Credit Bond Index during this period. However, the modest average maturity within the Fund’s fixed income portfolio was beneficial during the first half of 2018 and served to limit the Fund’s fixed income downside during the period. As of June 30, 2018, the Fund’s asset mix consisted of approximately 66.5% in equity securities, 31.8% in fixed income securities, and 1.7% in cash and cash equivalents.

LKCM Fixed Income Fund

The LKCM Fixed Income Fund outperformed its benchmark, the Bloomberg Barclays Intermediate Government/Credit Bond Index, during the six months ended June 30, 2018, declining 0.81% versus a 0.97% decline for the benchmark. During this period, yields rose across the curve and the yield curve flattened substantially as the Federal Reserve continued to tighten monetary policy by increasing the federal funds rate and continuing balance sheet run off, which they initiated in October. In this environment, where shorter-duration securities outperformed their longer-duration counterparts, the Fund’s duration of approximately 2.9 years was additive to performance relative to the 3.9 year duration for the benchmark. The Fund’s overweight position in corporate bonds relative to the benchmark detracted from performance during the first half of 2018 as U.S. Treasury and government agency securities outperformed corporate bonds as credit spreads widened across each investment-grade credit rating sector. Within this backdrop, the Fund remains largely focused on short-to-intermediate investment-grade corporate bonds with strong underlying credit fundamentals to mitigate interest rate risk and credit risk in an environment where the Federal Reserve continues to gradually tighten monetary policy, inflation remains subdued and economic growth improves.

LKCM Small Cap Equity Fund

The LKCM Small Cap Equity Fund – Institutional Class outperformed its benchmark, the Russell 2000^® Index, during the six months ended June 30, 2018, returning 10.47% compared to the 7.66% return for the benchmark. During the first half of 2018, stock selection for the Fund was additive to the Fund’s relative performance, while sector allocation decisions for the Fund were essentially neutral to the Fund’s relative performance. The Fund benefited from positive stock selection in the Information Technology, Consumer Discretionary and Healthcare sectors relative to the benchmark, which more than offset the stock selection drag in the Industrials and Materials sectors. The Fund’s overweight position in the Information Technology sector benefited the Fund’s relative performance, which was offset by an overweight allocation in the Industrials sector and an underweight allocation in the Real Estate sector. We believe the Fund remains positioned for continued economic growth (overweight Technology and Industrials sectors) and higher interest rates (underweight Real Estate and Utilities). We also believe our investment strategy for the Fund of investing in higher quality, competitively advantaged companies with viable strategies to increase the value of their businesses will continue to be beneficial for the Fund’s shareholders.

LKCM Small-Mid Cap Equity Fund

The LKCM Small-Mid Cap Equity Fund outperformed its benchmark, Russell 2500^® Index, during the six months ended June 30, 2018, returning 5.94% compared to the 5.46% return for the benchmark. During the first half of 2018, stock selection for the Fund was additive to the Fund’s relative performance, while sector allocation decisions for the Fund were essentially neutral to the Fund’s relative performance. The Fund benefited from positive stock selection in the Information Technology, Financials and Consumer Discretionary sectors relative to the benchmark, which more than offset the stock selection drag in the Industrials and Materials sectors. The Fund’s overweight position in the Information Technology sector benefited the Fund’s relative performance, which was offset by an overweight allocation in the Industrials sector. We believe the Fund remains positioned for continued economic growth (overweight Technology and Industrials sectors) and higher interest rates (underweight Real Estate and Utilities). We also believe our investment strategy for the Fund of investing in higher quality, competitively advantaged companies with viable strategies to increase the value of their businesses will continue to be beneficial for the Fund’s shareholders.

J. Luther King, Jr., CFA, CIC

August 6, 2018

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The information provided herein represents the opinion of J. Luther King, Jr., CFA, CIC and is not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

Please refer to the Schedule of Investments found on pages 9-21 of the report for more information on Fund holdings. Fund holdings and sector allocations are subject to change and are not recommendations to buy or sell any securities.

Mutual fund investing involves risk. Principal loss is possible. Past performance is not a guarantee of future results. Small and medium capitalization funds typically carry additional risks, since smaller companies generally have a higher risk of failure, and, historically, their stocks have experienced a greater degree of market volatility than stocks on average. Investments in debt securities typically decrease in value when interest rates rise. This risk is greater for longer-term debt securities. Investments in mortgage backed securities include additional risks that investors should be aware of such as credit risk, prepayment risk, possible illiquidity and default, as well as increased susceptibility to adverse economic developments. These risks are discussed in the Funds’ summary and statutory prospectuses.

Earnings growth is not a measure of future performance.

Duration is a commonly used measure of the potential volatility of the price of a debt security, or the aggregate market value of a portfolio of debt securities, prior to maturity. Securities with a longer duration generally have more volatile prices than securities of comparable quality with a shorter duration.

Spread is the percentage point difference between yields of various classes of bonds compared to treasury bonds.

Must be preceded or accompanied by a prospectus.

Quasar Distributors, LLC, distributor.

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LKCM Funds Expense Example — June 30, 2018 (Unaudited)

As a shareholder of the Funds, you incur two types of costs: (1) transaction costs, including redemption fees; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (1/1/18-6/30/18).

ACTUAL EXPENSES

The first line of the tables below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. Although the Funds charge no sales load, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Funds’ transfer agent. If you request that a redemption be made by wire transfer, currently a $15.00 fee is charged by the Funds’ transfer agent. You will be charged a redemption fee equal to 1.00% of the net amount of the redemption if you redeem your shares of the LKCM Small Cap Equity, Small-Mid Cap Equity, Equity, Balanced and Fixed Income Funds within 30 days of purchase, unless otherwise determined by the Funds in their discretion. To the extent the Funds invest in shares of other investment companies as part of their investment strategies, you will indirectly bear your proportionate share of any fees and expenses charged by the underlying funds in which the Funds invest in addition to the expenses of the Funds. Actual expenses of the underlying funds are expected to vary among the various underlying funds. These expenses are not included in the example below. The example below includes management fees, registration fees and other expenses. However, the example below does not include portfolio trading commissions and related expenses and other extraordinary expenses as determined under generally accepted accounting principles.

HYPOTHETICAL EXAMPLES FOR COMPARISON PURPOSES

The second line of the tables below provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which are not the Funds’ actual returns. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactions costs were included, your costs would have been higher.

	LKCM Small Cap Equity Fund – Institutional Class
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18–6/30/18
Actual	$	1,000.00	$	1,104.70	$	5.22
Hypothetical (5% return before expense)	$	1,000.00	$	1,019.84	$	5.01

* Expenses are equal to the Fund’s annualized net expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

	LKCM Small Cap Equity Fund – Adviser Class
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18–6/30/18
Actual	$	1,000.00	$	1,103.90	$	6.52
Hypothetical (5% return before expense)	$	1,000.00	$	1,018.60	$	6.26

* Expenses are equal to the Fund’s annualized net expense ratio of 1.25%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

	LKCM Small-Mid Cap Equity Fund
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18–6/30/18
Actual	$	1,000.00	$	1,059.40	$	5.11
Hypothetical (5% return before expense)	$	1,000.00	$	1,019.84	$	5.01

* Expenses are equal to the Fund’s annualized net expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

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	LKCM Equity Fund
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18–6/30/18
Actual	$	1,000.00	$	1,051.90	$	4.07
Hypothetical (5% return before expense)	$	1,000.00	$	1,020.83	$	4.01

* Expenses are equal to the Fund’s annualized net expense ratio of 0.80%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

	LKCM Balanced Fund
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18–6/30/18
Actual	$	1,000.00	$	1,016.90	$	4.00
Hypothetical (5% return before expense)	$	1,000.00	$	1,020.83	$	4.01

* Expenses are equal to the Fund’s annualized net expense ratio of 0.80%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

	LKCM Fixed Income Fund
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18–6/30/18
Actual	$	1,000.00	$	991.90	$	2.47
Hypothetical (5% return before expense)	$	1,000.00	$	1,022.32	$	2.51

* Expenses are equal to the Fund’s annualized net expense ratio of 0.50%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

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ALLOCATION OF PORTFOLIO HOLDINGS — LKCM Funds — June 30, 2018 (Unaudited)

Percentages represent market value as a percentage of total investments.

LKCM Small Cap Equity Fund

LKCM Equity Fund

LKCM Fixed Income Fund

LKCM Small-Mid Cap Equity Fund

LKCM Balanced Fund

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LKCM SMALL CAP EQUITY FUND

SCHEDULEOF INVESTMENTS

June 30, 2018 (Unaudited)

COMMON STOCKS - 97.9%	Shares		Value
Aerospace & Defense - 1.1%
Mercury Systems, Inc. (a)		60,020		$	2,284,361
Banks - 9.8%
BancorpSouth Bank		84,154			2,772,874
Cadence BanCorporation		90,490			2,612,446
CBTX, Inc.		45,440			1,501,792
Glacier Bancorp, Inc.		50,460			1,951,793
Green Bancorp, Inc.		84,060			1,815,696
LegacyTexas Financial Group, Inc.		58,955			2,300,424
Pinnacle Financial Partners, Inc.		41,965			2,574,553
Seacoast Banking Corp of Florida (a)		83,040			2,622,403
Texas Capital Bancshares, Inc. (a)		25,260			2,311,290
					20,463,271
Biotechnology - 4.5%
Charles River Laboratories International, Inc. (a)		27,555			3,093,324
Ligand Pharmaceuticals Incorporated (a)		14,280			2,958,388
Neogen Corporation (a)		43,080			3,454,585
					9,506,297
Building Products - 4.5%
American Woodmark Corporation (a)		14,650			1,341,207
Builders FirstSource, Inc. (a)		134,795			2,465,401
CSW Industrials, Inc. (a)		43,690			2,309,016
Patrick Industries, Inc. (a)		8,470			481,520
PGT, Inc. (a)		111,121			2,316,873
Trex Company, Inc. (a)		8,310			520,123
					9,434,140
Capital Markets - 0.4%
BGC Partners Inc. - Class A		73,960			837,227
Chemicals - 2.3%
Ferro Corporation (a)		103,545			2,158,913
Ferroglobe PLC (b)		225,490			1,932,450
Ferroglobe Representation & Warranty Insurance Trust (a)(b)		302,970			—
GCP Applied Technologies Inc. (a)		23,795			688,865
					4,780,228
Commercial Services & Supplies - 1.3%
Healthcare Services Group, Inc.		62,745			2,709,957
Communications Equipment - 1.1%
Finisar Corporation (a)		15,000			270,000
Infinera Corporation (a)		201,980			2,005,661
			2,275,661
Construction & Engineering - 1.7%
EMCOR Group, Inc.		33,520			2,553,554
MasTec Inc. (a)		21,130			1,072,347
					3,625,901
Construction Materials - 1.1%
Summit Materials, Inc. - Class A (a)		88,814			2,331,368

COMMON STOCKS	Shares		Value
Consumer Finance - 1.5%
FirstCash, Inc.		34,450		$	3,095,332
Electronic Equipment, Instruments & Components - 2.4%
Littelfuse, Inc.		11,770			2,685,678
Mesa Laboratories, Inc.		10,670			2,252,224
					4,937,902
Energy Equipment & Services - 0.9%
Mammoth Energy Services, Inc. (a)		53,210			1,807,012
Food & Drug Retailing - 0.5%
Sprouts Farmers Market, Inc. (a)		43,595			962,142
Food Products - 1.4%
Freshpet, Inc. (a)		13,525			371,261
Hostess Brands, Inc. (a)		98,940			1,345,584
J & J Snack Foods Corp.		7,370			1,123,704
					2,840,549
Health Care Equipment & Supplies - 5.5%
Cantel Medical Corp.		32,335			3,180,470
K2M Group Holdings Inc. (a)		80,000			1,800,000
LeMaitre Vascular, Inc.		51,670			1,729,912
PRA Health Sciences, Inc. (a)		10,242			956,193
STAAR Surgical Co. (a)		121,390			3,763,090
					11,429,665
Health Care Providers & Services - 3.9%
HealthEquity, Inc. (a)		48,435			3,637,468
Omnicell, Inc. (a)		47,640			2,498,718
U.S. Physical Therapy, Inc.		21,805			2,093,280
					8,229,466
Health Care Technology - 0.3%
Teladoc, Inc. (a)		9,910			575,276
Hotels, Restaurants & Leisure - 1.8%
Planet Fitness, Inc. - Class A (a)		62,410			2,742,295
Wingstop Inc.		20,130			1,049,176
					3,791,471
Insurance - 0.5%
Trupanion, Inc. (a)		26,535			1,024,251
Internet & Catalog Retail - 1.0%
Nutrisystem, Inc.		56,785			2,186,223
Internet Software & Services - 11.8%
Alarm.com Holdings, Inc. (a)		57,770			2,332,752
Carbonite, Inc. (a)		73,660			2,570,734
Cornerstone OnDemand, Inc. (a)		48,025			2,277,826
Coupa Software, Inc. (a)		72,520			4,513,645
Euronet Worldwide, Inc. (a)		22,710			1,902,417
New Relic, Inc. (a)		19,800			1,991,682
Stamps.com Inc. (a)		13,015			3,293,446
The Trade Desk Inc. - Class A (a)		23,865			2,238,537
Twilio Inc. - Class A (a)		64,570			3,617,211
					24,738,250

The accompanying notes are an integral part of these financial statements.

9

LKCM SMALL CAP EQUITY FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

COMMON STOCKS	Shares		Value
IT Consulting & Services - 1.9%
Acxiom Corporation (a)		71,521		$	2,142,054
FireEye, Inc. (a)		114,145			1,756,691
					3,898,745
IT Services - 0.7%
Cass Information Systems, Inc.		21,545			1,482,727
Machinery - 5.2%
Barnes Group Inc.		26,185			1,542,296
John Bean Technologies Corporation		23,610			2,098,929
Kennametal Inc.		73,195			2,627,701
Lindsay Corporation		11,300			1,095,987
Rexnord Corporation (a)		64,070			1,861,874
Watts Water Technologies, Inc. - Class A		22,015			1,725,976
					10,952,763
Marine - 1.6%
Kirby Corporation (a)		40,145			3,356,122
Media - 1.4%
Criteo SA - ADR (a)(b)		42,545			1,397,603
Nexstar Media Group, Inc. - Class A		21,635			1,588,009
					2,985,612
Metals & Mining - 1.3%
Carpenter Technology Corporation		51,155			2,689,218
Multiline Retail - 2.6%
Five Below, Inc. (a)		16,985			1,659,604
Ollie’s Bargain Outlet Holdings, Inc. (a)		52,125			3,779,063
					5,438,667
Oil & Gas & Consumable Fuels - 4.7%
Matador Resources Company (a)		82,725			2,485,886
Oasis Petroleum Inc. (a)		126,230			1,637,203
PDC Energy, Inc. (a)		19,405			1,173,032
Ring Energy Inc (a)		173,675			2,191,779
SRC Energy Inc. (a)		202,710			2,233,864
					9,721,764
Pharmaceuticals - 0.6%
Cambrex Corp. (a)		22,659			1,185,066
Real Estate Investment Trusts - 2.2%
First Industrial Realty Trust, Inc.		64,015			2,134,260
Life Storage, Inc.		25,000			2,432,750
					4,567,010
Road & Rail - 1.1%
Genesee & Wyoming Inc. - Class A (a)		27,525			2,238,333

COMMON STOCKS	Shares		Value
Software - 5.0%
ACI Worldwide, Inc. (a)		86,610		$	2,136,669
Envestnet, Inc. (a)		60,116			3,303,374
Fair Isaac Corporation (a)		13,575			2,624,319
RealPage, Inc. (a)		43,400			2,391,340
					10,455,702
Textiles, Apparel & Luxury Goods - 3.6%
Columbia Sportswear Company		33,121			3,029,578
Oxford Industries, Inc.		32,790			2,720,914
Steven Madden Ltd.		34,690			1,842,039
					7,592,531
Thrifts & Mortgage Finance - 2.3%
Banc of California, Inc.		113,145			2,211,985
Home BancShares Inc.		118,721			2,678,346
					4,890,331
Trading Companies & Distributors - 4.4%
DXP Enterprises Inc/TX (a)		54,495			2,081,709
MSC Industrial Direct Co., Inc. - Class A		22,395			1,900,216
Systemax, Inc.		15,460			530,742
Textainer Group Holdings Ltd. (a)(b)		140,370			2,231,883
Triton International Limited (b)		81,935			2,512,127
					9,256,677
TOTAL COMMON STOCKS (Cost $142,711,178)					204,577,218
SHORT-TERM INVESTMENT - 2.7%
Money Market Fund - 2.7%
Invesco Short-Term Investments Trust-Government & Agency Portfolio - Institutional Shares, 1.81% (c)		5,653,818			5,653,818
TOTAL SHORT-TERM INVESTMENT (Cost $5,653,818)					5,653,818
Total Investments - 100.6% (Cost $148,364,996)					210,231,036
Liabilities in Excess of Other Assets - (0.6)%					(1,199,681	)
TOTAL NET ASSETS - 100.0%				$	209,031,355

ADR American Depositary Receipt

(a) Non-income producing security.

(b) Security issued by non-U.S. incorporated company.

(c) The rate quoted is the annualized seven-day yield of the fund at period end.

Investments are classified by industry pursuant to the Global Industry Classification Standard (GICS^®), which was developed by and/or is the exclusive property of Morgan Stanley Capital International, Inc. (“MSCI”) and Standard & Poor’s Financial Services LLC (“S&P”). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.

The accompanying notes are an integral part of these financial statements.

10

LKCM SMALL-MID CAP EQUITY FUND

SCHEDULEOF INVESTMENTS

June 30, 2018 (Unaudited)

COMMON STOCKS - 97.9%	Shares		Value
Aerospace & Defense - 4.6%
HEICO Corporation		5,159		$	376,228
Hexcel Corporation		3,865			256,559
Mercury Systems, Inc. (a)		4,040			153,762
					786,549
Banks - 6.3%
LegacyTexas Financial Group, Inc.		6,775			264,360
Pinnacle Financial Partners, Inc.		3,865			237,118
SVB Financial Group (a)		1,095			316,192
Texas Capital Bancshares, Inc. (a)		2,815			257,573
					1,075,243
Biotechnology - 5.3%
Charles River Laboratories International, Inc. (a)		2,660			298,612
Ligand Pharmaceuticals Incorporated (a)		1,550			321,113
Neogen Corporation (a)		3,645			292,293
					912,018
Building Products - 1.6%
Builders FirstSource, Inc. (a)		14,715			269,137
Capital Markets - 3.4%
Lazard Ltd. - Class A (b)		6,320			309,111
SEI Investments Company		4,290			268,211
					577,322
Chemicals - 3.0%
CF Industries Holdings, Inc.		7,285			323,454
FMC Corporation		2,245			200,276
					523,730
Commercial Services & Supplies - 1.4%
Healthcare Services Group, Inc.		5,749			248,299
Construction & Engineering - 1.5%
EMCOR Group, Inc.		3,400			259,012
Construction Materials - 0.8%
Summit Materials, Inc. - Class A (a)		5,025			131,906
Consumer Finance - 2.0%
FirstCash, Inc.		3,915			351,763
Diversified Financials - 2.8%
MSCI Inc.		2,905			480,574
Electronic Equipment, Instruments & Components - 4.8%
FLIR Systems, Inc.		6,185			321,435
Littelfuse, Inc.		1,540			351,397
Trimble Inc. (a)		4,855			159,438
					832,270
Health Care Equipment & Supplies - 3.6%
Cantel Medical Corp.		3,485			342,784
PRA Health Sciences, Inc. (a)		2,955			275,879
					618,663

COMMON STOCKS	Shares		Value
Health Care Providers & Services - 3.1%
HealthEquity, Inc. (a)		4,705		$	353,345
Omnicell, Inc. (a)		3,450			180,953
					534,298
Internet Software & Services - 7.9%
Akamai Technologies, Inc. (a)		4,570			334,661
Euronet Worldwide, Inc. (a)		2,865			240,001
Stamps.com Inc. (a)		1,465			370,718
Twilio Inc. - Class A (a)		7,435			416,509
					1,361,889
IT Consulting & Services - 1.2%
Acxiom Corporation (a)		7,110			212,945
Leisure Equipment & Products - 3.5%
Polaris Industries Inc.		2,455			299,952
Pool Corporation		2,035			308,302
					608,254
Machinery - 2.5%
John Bean Technologies Corporation		670			59,563
Kennametal Inc.		5,610			201,399
Rexnord Corporation (a)		6,005			174,505
					435,467
Marine - 1.7%
Kirby Corporation (a)		3,495			292,182
Metals & Mining - 2.6%
Ferroglobe PLC (b)		17,590			150,746
Reliance Steel & Aluminum Co.		3,315			290,195
					440,941
Multiline Retail - 2.6%
Ollie’s Bargain Outlet Holdings, Inc. (a)		6,110			442,975
Oil & Gas & Consumable Fuels - 5.8%
Diamondback Energy Inc.		2,040			268,403
Matador Resources Company (a)		10,300			309,515
WPX Energy Inc. (a)		22,845			411,895
					989,813
Real Estate Investment Trusts - 3.5%
First Industrial Realty Trust, Inc.		8,215			273,888
Life Storage, Inc.		3,395			330,368
					604,256
Road & Rail - 1.2%
Genesee & Wyoming Inc. - Class A (a)		2,455			199,641
Software - 9.5%
Envestnet, Inc. (a)		5,205			286,015
Fair Isaac Corporation (a)		1,895			366,342
Fortinet Inc. (a)		6,010			375,204
Guidewire Software Inc. (a)		4,085			362,666
Proofpoint, Inc. (a)		2,120			244,457
					1,634,684

The accompanying notes are an integral part of these financial statements.

11

LKCM SMALL-MID CAP EQUITY FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

COMMON STOCKS	Shares		Value
Specialty Retail - 1.8%
Tiffany & Co.		2,300		$	302,680
Textiles, Apparel & Luxury Goods - 3.9%
Columbia Sportswear Company		3,350			306,425
Michael Kors Holdings Ltd. (a)(b)		5,480			364,968
					671,393
Thrifts & Mortgage Finance - 1.4%
Home BancShares Inc.		10,850			244,776
Trading Companies & Distributors - 4.6%
MSC Industrial Direct Co., Inc. - Class A		2,875			243,944
Triton International Limited (b)		7,810			239,455
Watsco, Inc.		1,765			314,664
					798,063
TOTAL COMMON STOCKS (Cost $12,257,002)					16,840,743
SHORT-TERM INVESTMENT - 2.2%
Money Market Fund - 2.2%
Invesco Short-Term Investments Trust-Government & Agency Portfolio - Institutional Shares, 1.81% (c)		372,640			372,640
TOTAL SHORT-TERM INVESTMENT (Cost $372,640)					372,640
Total Investments - 100.1% (Cost $12,629,642)					17,213,383
Liabilities in Excess of Other Assets - (0.1)%					(14,589	)
TOTAL NET ASSETS - 100.0%				$	17,198,794

(a) Non-income producing security.

(b) Security issued by non-U.S. incorporated company.

(c) The rate quoted is the annualized seven-day yield of the fund at period end.

Investments are classified by industry pursuant to the Global Industry Classification Standard (GICS^®), which was developed by and/or is the exclusive property of Morgan Stanley Capital International, Inc. (“MSCI”) and Standard & Poor’s Financial Services LLC (“S&P”). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.

The accompanying notes are an integral part of these financial statements.

12

LKCM EQUITY FUND

SCHEDULEOF INVESTMENTS

June 30, 2018 (Unaudited)

COMMON STOCKS - 95.2%	Shares		Value
Aerospace & Defense - 2.5%
Honeywell International Inc.		60,000		$	8,643,000
Banks - 9.2%
Bank of America Corporation		385,000			10,853,150
Comerica Incorporated		126,000			11,455,920
Cullen/Frost Bankers, Inc.		65,000			7,035,600
Glacier Bancorp, Inc.		60,000			2,320,800
					31,665,470
Beverages - 2.6%
The Coca-Cola Company		80,000			3,508,800
PepsiCo, Inc.		49,000			5,334,630
					8,843,430
Biotechnology - 2.1%
Amgen Inc.		40,000			7,383,600
Chemicals - 5.0%
DowDuPont Inc.		90,000			5,932,800
Ecolab Inc.		30,000			4,209,900
FMC Corporation		80,000			7,136,800
					17,279,500
Commercial Services & Supplies - 3.2%
Cintas Corporation		20,000			3,701,400
Waste Connections, Inc. (b)		97,500			7,339,800
					11,041,200
Computers & Peripherals - 2.3%
Apple Inc.		42,500			7,867,175
Construction Materials - 1.3%
Martin Marietta Materials, Inc.		20,000			4,466,600
Diversified Financials - 3.1%
JPMorgan Chase & Co.		102,000			10,628,400
Diversified Telecommunication Services - 0.9%
AT&T Inc.		100,590			3,229,945
Electrical Equipment & Instruments - 4.5%
Emerson Electric Co.		80,000			5,531,200
Franklin Electric Co., Inc.		85,000			3,833,500
Roper Technologies, Inc.		23,000			6,345,930
					15,710,630
Electronic Equipment & Instruments - 3.1%
Littelfuse, Inc.		18,000			4,107,240
National Instruments Corporation		55,000			2,308,900
Trimble Inc. (a)		135,000			4,433,400
					10,849,540
Health Care Equipment & Supplies - 6.6%
Danaher Corporation		75,000			7,401,000
PerkinElmer, Inc.		100,000			7,323,000
Thermo Fisher Scientific Inc.		40,000			8,285,600
					23,009,600

COMMON STOCKS	Shares		Value
Household Products - 1.5%
Kimberly-Clark Corporation		50,000		$	5,267,000
Internet & Catalog Retail - 2.5%
Amazon.com, Inc. (a)		5,000			8,499,000
Internet Software & Services - 7.7%
Akamai Technologies, Inc. (a)		90,000			6,590,700
Alarm.com Holdings, Inc. (a)		67,000			2,705,460
Alphabet, Inc. - Class A (a)		7,000			7,904,330
Facebook, Inc. - Class A (a)		35,000			6,801,200
LogMeIn, Inc.		25,000			2,581,250
					26,582,940
IT Consulting & Services - 1.8%
PayPal Holdings, Inc. (a)		75,000			6,245,250
Machinery - 4.9%
Generac Holdings, Inc. (a)		108,000			5,586,840
The Toro Company		74,000			4,458,500
Valmont Industries, Inc.		45,000			6,783,750
					16,829,090
Marine - 1.1%
Kirby Corporation (a)		45,000			3,762,000
Oil & Gas & Consumable Fuels - 7.4%
Cabot Oil & Gas Corporation		170,000			4,046,000
ConocoPhillips		62,000			4,316,440
EOG Resources, Inc.		65,000			8,087,950
Occidental Petroleum Corporation		110,000			9,204,800
					25,655,190
Personal Products - 1.2%
The Estee Lauder Companies Inc. - Class A		30,000			4,280,700
Pharmaceuticals - 7.0%
AbbVie Inc.		65,000			6,022,250
Johnson & Johnson		38,000			4,610,920
Merck & Co., Inc.		80,000			4,856,000
Pfizer Inc.		115,000			4,172,200
Zoetis Inc.		53,500			4,557,665
					24,219,035
Road & Rail - 1.2%
Kansas City Southern		40,000			4,238,400
Software - 6.7%
Adobe Systems Incorporated (a)		40,265			9,817,009
Envestnet, Inc. (a)		65,000			3,571,750
Microsoft Corporation		100,000			9,861,000
					23,249,759
Specialty Retail - 3.4%
The Home Depot, Inc.		40,000			7,804,000
Tiffany & Co.		30,000			3,948,000
					11,752,000

The accompanying notes are an integral part of these financial statements.

13

LKCM EQUITY FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

COMMON STOCKS	Shares			Value
Textiles, Apparel & Luxury Goods - 2.4%
VF Corporation			100,000		$	8,152,000
TOTAL COMMON STOCKS (Cost $182,551,228)						329,350,454
U.S. GOVERNMENT ISSUE - 2.9%	Principal Amount
U.S. Treasury Note - 2.9%
1.500%, 05/31/2019		$	10,000,000			9,925,586
TOTAL U.S. GOVERNMENT ISSUE (Cost $9,925,945)						9,925,586
SHORT-TERM INVESTMENT - 2.0%	Shares
Money Market Fund - 2.0%
Invesco Short-Term Investments Trust-Government & Agency Portfolio - Institutional Shares, 1.81% (c)			6,961,541			6,961,541
TOTAL SHORT-TERM INVESTMENT (Cost $6,961,541)						6,961,541
Total Investments - 100.1% (Cost $199,438,714)						346,237,581
Liabilities in Excess of Other Assets - (0.1)%						(213,711	)
TOTAL NET ASSETS - 100.0%					$	346,023,870

(a) Non-income producing security.

(b) Security issued by non-U.S. incorporated company.

(c) The rate quoted is the annualized seven-day yield of the fund at period end.

Investments are classified by industry pursuant to the Global Industry Classification Standard (GICS^®), which was developed by and/or is the exclusive property of Morgan Stanley Capital International, Inc. (“MSCI”) and Standard & Poor’s Financial Services LLC (“S&P”). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.

The accompanying notes are an integral part of these financial statements.

14

LKCM BALANCED FUND

SCHEDULEOF INVESTMENTS

June 30, 2018 (Unaudited)

COMMON STOCKS - 66.6%	Shares		Value
Aerospace & Defense - 1.5%
Honeywell International Inc.		5,100		$	734,655
Rockwell Collins, Inc.		4,300			579,124
					1,313,779
Banks - 5.0%
Bank of America Corporation		38,500			1,085,315
Comerica Incorporated		10,100			918,292
Cullen/Frost Bankers, Inc.		5,900			638,616
SunTrust Banks, Inc.		11,500			759,230
Zions Bancorporation		17,500			922,075
					4,323,528
Beverages - 1.7%
The Coca-Cola Company		17,600			771,936
PepsiCo, Inc.		6,700			729,429
					1,501,365
Biotechnology - 1.5%
Celgene Corporation (a)		6,700			532,114
Charles River Laboratories International, Inc. (a)		6,800			763,368
					1,295,482
Capital Markets - 1.1%
SEI Investments Company		14,500			906,540
Chemicals - 5.6%
Air Products and Chemicals, Inc.		5,100			794,223
DowDuPont Inc.		16,076			1,059,730
Ecolab Inc.		4,800			673,584
FMC Corporation		11,200			999,152
GCP Applied Technologies Inc. (a)		16,000			463,200
Praxair, Inc.		5,500			869,825
					4,859,714
Commercial Services & Supplies - 1.5%
Cintas Corporation		3,500			647,745
Waste Management, Inc.		7,900			642,586
					1,290,331
Computers & Peripherals - 1.5%
Apple Inc.		7,150			1,323,536
Construction Materials - 1.0%
Martin Marietta Materials, Inc.		3,900			870,987
Containers & Packaging - 0.4%
Ball Corporation		8,800			312,840
Diversified Financials - 2.3%
JPMorgan Chase & Co.		9,000			937,800
Moody’s Corporation		6,000			1,023,360
					1,961,160
Diversified Telecommunication Services - 1.5%
AT&T Inc.		26,739			858,589
Verizon Communications Inc.		8,641			434,729
					1,293,318

COMMON STOCKS	Shares		Value
Electrical Equipment - 0.9%
Rockwell Automation, Inc.		4,500		$	748,035
Electronic Equipment & Instruments - 1.4%
National Instruments Corporation		12,300			516,354
Trimble Inc. (a)		22,200			729,048
					1,245,402
Food & Drug Retailing - 1.6%
Walgreens Boots Alliance, Inc.		11,400			684,171
Walmart, Inc.		8,100			693,765
					1,377,936
Food Products - 0.9%
Mondelez International Inc. - Class A		19,800			811,800
Health Care Equipment & Supplies - 3.7%
Danaher Corporation		9,600			947,328
Medtronic, PLC (b)		7,600			650,636
PerkinElmer, Inc.		11,600			849,468
Thermo Fisher Scientific, Inc.		3,700			766,418
					3,213,850
Household Durables - 0.7%
Whirlpool Corporation		3,900			570,297
Household Products - 2.0%
Colgate-Palmolive Company		11,600			751,796
Kimberly-Clark Corporation		6,600			695,244
The Procter & Gamble Company		3,500			273,210
					1,720,250
Internet & Catalog Retail - 1.4%
Amazon.com, Inc. (a)		700			1,189,860
Internet Software & Services - 4.0%
Akamai Technologies, Inc. (a)		12,500			915,375
Alphabet, Inc. - Class A (a)		250			282,298
Alphabet, Inc. - Class C (a)		625			697,281
Facebook, Inc. - Class A (a)		4,600			893,872
LogMeIn, Inc.		6,000			619,500
					3,408,326
IT Consulting & Services - 2.0%
PayPal Holdings, Inc. (a)		11,400			949,278
Visa Inc. - Class A		5,600			741,720
					1,690,998
Machinery - 0.8%
Fortive Corporation		9,100			701,701
Marine - 0.9%
Kirby Corporation (a)		9,000			752,400
Media - 1.1%
CBS Corporation - Class B		3,600			202,392
The Walt Disney Company		6,700			702,227
					904,619

The accompanying notes are an integral part of these financial statements.

15

LKCM BALANCED FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

COMMON STOCKS	Shares			Value
Oil & Gas & Consumable Fuels - 6.1%
Anadarko Petroleum Corporation			9,500		$	695,875
Cabot Oil & Gas Corporation			25,900			616,420
Chevron Corporation			5,795			732,662
ConocoPhillips			11,400			793,668
EOG Resources, Inc.			6,000			746,580
Exxon Mobil Corporation			6,727			556,525
Pioneer Natural Resources Company			2,600			492,024
WPX Energy Inc. (a)			35,000			631,050
						5,264,804
Pharmaceuticals - 5.2%
Abbott Laboratories			16,000			975,840
AbbVie Inc.			11,000			1,019,150
Merck & Co., Inc.			9,800			594,860
Pfizer Inc.			17,100			620,388
Zoetis Inc.			14,400			1,226,736
						4,436,974
Real Estate Investment Trusts - 0.5%
American Tower Corporation			3,200			461,344
Road & Rail - 0.5%
Union Pacific Corporation			3,000			425,040
Software - 4.9%
Adobe Systems Incorporated (a)			4,300			1,048,383
Citrix Systems, Inc. (a)			4,000			419,360
Microsoft Corporation			11,000			1,084,710
Oracle Corporation			15,400			678,524
RealPage, Inc. (a)			18,500			1,019,350
						4,250,327
Specialty Retail - 1.4%
The Home Depot, Inc.			4,300			838,930
O’Reilly Automotive, Inc. (a)			1,400			382,998
						1,221,928
Textiles, Apparel & Luxury Goods - 2.0%
NIKE, Inc. - Class B			11,600			924,288
VF Corporation			9,500			774,440
						1,698,728
TOTAL COMMON STOCKS (Cost $38,295,308)						57,347,199
CORPORATE BONDS - 31.8%	Principal Amount
Aerospace & Defense - 0.3%
Rockwell Collins, Inc.
3.700%, 12/15/2023
Callable 09/15/2023		$	250,000			249,173
Air Freight & Logistics - 1.1%
FedEx Corp.
2.700%, 04/15/2023			425,000			409,514
United Parcel Service, Inc.
2.450%, 10/01/2022			600,000			581,732
						991,246

CORPORATE BONDS	Principal Amount			Value
Banks - 2.7%
Bank of America Corporation:
2.625%, 10/19/2020		$	400,000		$	395,211
2.625%, 04/19/2021			250,000			245,693
The Bank of New York Mellon Corporation:
2.450%, 11/27/2020
Callable 10/27/2020			350,000			344,413
2.500%, 04/15/2021
Callable 03/15/2021			200,000			196,398
BB&T Corporation
2.250%, 02/01/2019
Callable 01/02/2019			115,000			114,719
Comerica Incorporated
2.125%, 05/23/2019
Callable 04/23/2019			435,000			432,212
Wells Fargo & Company:
2.150%, 01/15/2019			200,000			199,351
2.125%, 04/22/2019			150,000			149,172
Wells Fargo Bank, National Association
1.750%, 05/24/2019			250,000			247,793
						2,324,962
Beverages - 0.5%
PepsiCo, Inc.
3.000%, 08/25/2021			415,000			416,052
Biotechnology - 1.3%
Amgen Inc.:
2.200%, 05/22/2019
Callable 04/22/2019			100,000			99,471
2.125%, 05/01/2020
Callable 04/01/2020			100,000			98,352
2.700%, 05/01/2022
Callable 03/01/2022			325,000			315,967
Celgene Corporation
3.625%, 05/15/2024
Callable 02/15/2024			250,000			244,220
Gilead Sciences, Inc.
2.050%, 04/01/2019			335,000			333,430
						1,091,440
Chemicals - 0.6%
Ecolab Inc.:
2.000%, 01/14/2019			250,000			249,080
2.250%, 01/12/2020			100,000			98,786
3.250%, 01/14/2023
Callable 11/14/2022			200,000			197,694
						545,560
Communications Equipment - 1.0%
Cisco Systems, Inc.:
2.125%, 03/01/2019			250,000			249,399
2.200%, 02/28/2021			275,000			269,906
QUALCOMM Incorporated
2.250%, 05/20/2020			350,000			344,997
						864,302

The accompanying notes are an integral part of these financial statements.

16

LKCM BALANCED FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

CORPORATE BONDS	Principal Amount			Value
Computers & Peripherals - 1.0%
Apple Inc.
2.850%, 05/06/2021		$	500,000		$	499,004
International Business Machines Corporation
2.250%, 02/19/2021			350,000			342,589
						841,593
Consumer Finance - 0.3%
American Express Credit Corporation 2.600%, 09/14/2020
Callable 08/14/2020			300,000			296,346
Diversified Financials - 0.7%
JPMorgan Chase & Co.:
2.400%, 06/07/2021
Callable 05/07/2021			400,000			389,869
3.375%, 05/01/2023			225,000			219,903
						609,772
Diversified Telecommunication Services - 1.6%
AT&T Inc.
2.450%, 06/30/2020
Callable 05/30/2020			725,000			714,379
Verizon Communications Inc.:
3.000%, 11/01/2021
Callable 09/01/2021			455,000			447,930
2.450%, 11/01/2022
Callable 08/01/2022			200,000			190,899
						1,353,208
Electrical Equipment & Instruments - 1.7%
Emerson Electric Co.:
2.625%, 02/15/2023
Callable 11/15/2022			400,000			388,377
3.150%, 06/01/2025
Callable 03/01/2025			200,000			195,151
Rockwell Automation, Inc.
2.050%, 03/01/2020
Callable 02/01/2020			288,000			283,201
Roper Technologies, Inc.
2.800%, 12/15/2021
Callable 11/15/2021			600,000			586,447
						1,453,176
Electronic Equipment & Instruments - 0.3%
Trimble Inc.
4.150%, 06/15/2023
Callable 05/15/2023			250,000			249,473
Food & Drug Retailing - 1.1%
Costco Wholesale Corporation
2.250%, 02/15/2022			400,000			388,397
Walgreens Boots Alliance, Inc.:
3.300%, 11/18/2021
Callable 09/18/2021			325,000			323,189
3.800%, 11/18/2024
Callable 08/18/2024			250,000			246,785
						958,371

CORPORATE BONDS	Principal Amount			Value
Health Care Equipment & Supplies - 1.5%
Danaher Corporation
2.400%, 09/15/2020
Callable 08/15/2020		$	400,000		$	395,356
Medtronic, Inc.
2.500%, 03/15/2020			300,000			297,992
Thermo Fisher Scientific, Inc.
3.150%, 01/15/2023
Callable 10/15/2022			600,000			587,350
						1,280,698
Health Care Providers & Services - 0.6%
CVS Health Corporation:
2.250%, 12/05/2018
Callable 11/05/2018			175,000			174,541
2.125%, 06/01/2021
Callable 05/01/2021			400,000			384,785
						559,326
Hotels, Restaurants & Leisure - 0.3%
McDonald’s Corporation:
2.750%, 12/09/2020
Callable 11/09/2020			200,000			198,764
3.625%, 05/20/2021			100,000			101,247
						300,011
Household Durables - 0.9%
Newell Brands, Inc.:
2.150%, 10/15/2018			400,000			399,130
3.150%, 04/01/2021
Callable 03/01/2021			350,000			346,978
					��	746,108
Industrial Conglomerates - 0.6%
General Electric Company
2.700%, 10/09/2022			500,000			483,904
Insurance - 0.8%
Berkshire Hathaway Inc.
2.200%, 03/15/2021
Callable 02/15/2021			710,000			698,894
Internet & Catalog Retail - 0.8%
Amazon.com, Inc.
3.300%, 12/05/2021
Callable 10/05/2021			695,000			701,147
Internet Software & Services - 0.7%
Alphabet, Inc.
3.375%, 02/25/2024			600,000			604,805
Media - 0.8%
Time Warner Inc.
3.400%, 06/15/2022			250,000			246,652
The Walt Disney Company
2.300%, 02/12/2021			420,000			411,926
						658,578

The accompanying notes are an integral part of these financial statements.

17

LKCM BALANCED FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

CORPORATE BONDS	Principal Amount			Value
Oil & Gas & Consumable Fuels - 4.2%
Chevron Corporation
2.411%, 03/03/2022
Callable 01/03/2022		$	500,000		$	488,073
ConocoPhillips
2.400%, 12/15/2022
Callable 09/15/2022			490,000			471,895
Enterprise Products Operating LLC
2.850%, 04/15/2021
Callable 03/15/2021			500,000			494,110
EOG Resources, Inc.:
2.450%, 04/01/2020
Callable 03/01/2020			200,000			197,826
2.625%, 03/15/2023
Callable 12/15/2022			500,000			480,510
Exxon Mobil Corporation:
2.222%, 03/01/2021
Callable 02/01/2021			325,000			319,141
3.043%, 03/01/2026
Callable 12/01/2025			300,000			292,100
Kinder Morgan Energy Partners, L.P.
3.950%, 09/01/2022
Callable 06/01/2022			400,000			400,328
Occidental Petroleum Corporation
2.600%, 04/15/2022
Callable 03/15/2022			500,000			489,104
						3,633,087
Pharmaceuticals - 2.1%
Abbott Laboratories:
2.000%, 03/15/2020			250,000			245,943
3.400%, 11/30/2023
Callable 09/30/2023			350,000			345,741
AbbVie Inc.:
2.000%, 11/06/2018			134,000			133,615
2.500%, 05/14/2020
Callable 04/14/2020			425,000			420,068
Merck & Co., Inc.
2.350%, 02/10/2022			650,000			633,301
						1,778,668
Real Estate Investment Trusts - 0.6%
American Tower Corporation:
3.400%, 02/15/2019			400,000			401,138
2.800%, 06/01/2020
Callable 05/01/2020			100,000			99,187
						500,325
Road & Rail - 1.2%
Burlington Northern Santa Fe, LLC
3.000%, 03/15/2023
Callable 12/15/2022			600,000			589,079
Union Pacific Corporation
2.250%, 06/19/2020
Callable 05/19/2020			415,000			409,509
						998,588

CORPORATE BONDS	Principal Amount			Value
Semiconductor Equipment & Products - 0.5%
Texas Instruments Incorporated 2.750%, 03/12/2021
Callable 02/12/2021		$	470,000		$	468,672
Software - 1.3%
Microsoft Corporation 2.375%, 02/12/2022
Callable 01/12/2022			400,000			391,309
Oracle Corporation:
2.375%, 01/15/2019			125,000			124,994
2.800%, 07/08/2021			625,000			621,176
						1,137,479
Specialty Retail - 0.7%
The Home Depot, Inc.:
2.000%, 06/15/2019
Callable 05/15/2019			325,000			323,132
2.625%, 06/01/2022
Callable 05/01/2022			290,000			284,585
						607,717
TOTAL CORPORATE BONDS (Cost $28,039,385)						27,402,681
SHORT-TERM INVESTMENT - 1.5%	Shares
Money Market Fund - 1.5%
Invesco Short-Term Investments Trust - Government & Agency Portfolio -Institutional Shares, 1.81% (c)			1,332,840			1,332,840
TOTAL SHORT-TERM INVESTMENT (Cost $1,332,840)						1,332,840
Total Investments - 99.9% (Cost $67,667,533)						86,082,720
Other Assets in Excess of Liabilities - 0.1%						103,403
TOTAL NET ASSETS - 100.0%					$	86,186,123

(a) Non-income producing security.

(b) Security issued by non-U.S. incorporated company.

(c) The rate quoted is the annualized seven-day yield of the fund at period end.

Investments are classified by industry pursuant to the Global Industry Classification Standard (GICS^®), which was developed by and/or is the exclusive property of Morgan Stanley Capital International, Inc. (“MSCI”) and Standard & Poor’s Financial Services LLC (“S&P”). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.

The accompanying notes are an integral part of these financial statements.

18

LKCM FIXED INCOME FUND

SCHEDULEOF INVESTMENTS

June 30, 2018 (Unaudited)

CORPORATE BONDS - 74.3%	Principal Amount			Value
Aerospace & Defense - 0.7%
Rockwell Collins, Inc.
3.700%, 12/15/2023 Callable 09/15/2023		$	1,750,000		$	1,744,215
Air Freight & Logistics - 1.0%
FedEx Corp.
3.250%, 04/01/2026 Callable 01/01/2026			2,500,000			2,397,854
Banks - 7.5%
Bank of America Corporation:
2.050%, 12/07/2018			5,000,000			4,992,035
2.625%, 10/19/2020			2,600,000			2,568,870
3.542% (3 Month LIBOR USD + 1.180%), 10/21/2022 Callable 10/21/2021 (a)			2,000,000			2,037,599
BB&T Corporation
2.911% (3 Month LIBOR USD + 0.570%), 06/15/2020 (a)			2,000,000			2,010,720
Comerica Incorporated
2.125%, 05/23/2019 Callable 04/23/2019			1,000,000			993,590
Wells Fargo & Company:
2.125%, 04/22/2019			4,000,000			3,977,917
4.125%, 08/15/2023			2,000,000			2,013,115
						18,593,846
Biotechnology - 4.0%
Amgen Inc.
2.200%, 05/22/2019 Callable 04/22/2019			5,312,000			5,283,871
Celgene Corporation
3.625%, 05/15/2024 Callable 02/15/2024			4,750,000			4,640,176
						9,924,047
Capital Markets - 2.0%
Morgan Stanley:
3.209% (3 Month LIBOR USD + 0.850%), 01/24/2019 (a)			3,500,000			3,513,815
3.155% (3 Month LIBOR USD + 0.800%), 02/14/2020 Callable 02/14/2019 (a)			1,500,000			1,504,685
						5,018,500
Chemicals - 0.4%
Ecolab Inc.
2.375%, 08/10/2022 Callable 07/10/2022			1,000,000			964,934
Communications Equipment - 0.3%
Cisco Systems, Inc.
4.950%, 02/15/2019			700,000			710,096
Computers & Peripherals - 1.3%
Apple Inc.
2.400%, 05/03/2023			3,250,000			3,133,255

CORPORATE BONDS	Principal Amount			Value
Consumer Finance - 4.2%
American Express Company:
2.689% (3 Month LIBOR USD + 0.330%), 10/30/2020 Callable 09/29/2020 (a)		$	3,500,000		$	3,505,751
3.000%, 10/30/2024 Callable 09/29/2024			2,000,000			1,911,015
American Express Credit Corporation:
1.875%, 05/03/2019 Callable 04/03/2019			2,000,000			1,985,556
2.375%, 05/26/2020 Callable 04/25/2020			3,000,000			2,957,275
						10,359,597
Consumer Services - 1.0%
The Western Union Company
3.650%, 08/22/2018			2,500,000			2,502,923
Containers & Packaging - 2.1%
Ball Corporation:
5.000%, 03/15/2022			2,000,000			2,062,500
5.250%, 07/01/2025			3,000,000			3,071,250
						5,133,750
Diversified Financials - 4.4%
JPMorgan Chase & Co.:
3.317% (3 Month LIBOR USD + 0.955%), 01/23/2020 (a)			3,082,000			3,119,663
3.260% (3 Month LIBOR USD + 0.900%), 04/25/2023 Callable 04/25/2022 (a)			2,409,000			2,431,180
3.375%, 05/01/2023			2,000,000			1,954,697
2.700%, 05/18/2023 Callable 03/18/2023			3,500,000			3,362,282
						10,867,822
Diversified Telecommunication Services - 8.3%
AT&T Inc.:
2.375%, 11/27/2018			4,500,000			4,495,874
3.229% (3 Month LIBOR USD + 0.910%), 11/27/2018 (a)			3,000,000			3,009,489
2.997% (3 Month LIBOR USD + 0.670%), 03/11/2019 (a)			1,500,000			1,504,896
3.298% (3 Month LIBOR USD + 0.950%), 07/15/2021 (a)			2,000,000			2,019,910
CenturyLink, Inc.:
6.150%, 09/15/2019			1,402,000			1,433,545
5.800%, 03/15/2022			2,500,000			2,487,500
Verizon Communications Inc.:
4.086% (3 Month LIBOR USD + 1.750%), 09/14/2018 (a)			2,000,000			2,006,974
3.335% (3 Month LIBOR USD + 1.000%), 03/16/2022 (a)			2,000,000			2,032,799
2.450%, 11/01/2022 Callable 08/01/2022			1,750,000			1,670,365
						20,661,352

The accompanying notes are an integral part of these financial statements.

19

LKCM FIXED INCOME FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

CORPORATE BONDS	Principal Amount			Value
Electrical Equipment - 2.9%
Emerson Electric Co.:
2.625%, 12/01/2021 Callable 11/01/2021		$	950,000		$	933,089
3.150%, 06/01/2025 Callable 03/01/2025			5,000,000			4,878,784
Rockwell Automation, Inc.
2.875%, 03/01/2025 Callable 12/01/2024			1,440,000			1,369,857
						7,181,730
Electronic Equipment, Instruments & Components - 1.1%
Trimble Inc.
4.150%, 06/15/2023
Callable 05/15/2023			2,750,000			2,744,199
Food & Drug Retailing - 1.7%
Walgreens Boots Alliance, Inc.
3.800%, 11/18/2024
Callable 08/18/2024			4,375,000			4,318,740
Health Care Equipment & Supplies - 6.0%
Danaher Corporation:
2.400%, 09/15/2020
Callable 08/15/2020			2,000,000			1,976,779
3.350%, 09/15/2025
Callable 06/15/2025			5,500,000			5,408,107
PerkinElmer, Inc.
5.000%, 11/15/2021
Callable 08/15/2021			1,094,000			1,141,151
Thermo Fisher Scientific, Inc.:
4.150%, 02/01/2024
Callable 11/01/2023			4,500,000			4,572,885
2.950%, 09/19/2026
Callable 06/19/2026			2,000,000			1,850,952
						14,949,874
Health Care Providers & Services - 2.6%
CVS Health Corporation:
3.047% (3 Month LIBOR USD + 0.720%), 03/09/2021 (a)			4,500,000			4,524,431
4.125%, 05/15/2021
Callable 02/15/2021			2,000,000			2,036,721
						6,561,152
Household Durables - 1.3%
Newell Brands, Inc.
3.150%, 04/01/2021
Callable 03/01/2021			3,150,000			3,122,802
Household Products - 0.4%
The Procter & Gamble Company
8.000%, 09/01/2024			775,000			984,750
Industrial Conglomerates - 0.5%
Roper Technologies, Inc.
2.050%, 10/01/2018			1,250,000			1,248,511

CORPORATE BONDS	Principal Amount			Value
Internet & Catalog Retail - 2.8%
Amazon.com, Inc.:
2.600%, 12/05/2019
Callable 11/05/2019		$	2,000,000		$	2,001,230
2.500%, 11/29/2022
Callable 08/29/2022			5,000,000			4,857,482
						6,858,712
Internet Software & Services - 1.6%
Alphabet, Inc.
3.375%, 02/25/2024			4,000,000			4,032,031
Multiline Retail - 1.9%
Family Dollar Stores, Inc.
5.000%, 02/01/2021			4,500,000			4,676,400
Oil & Gas & Consumable Fuels - 6.2%
Chevron Corporation
2.411%, 03/03/2022
Callable 01/03/2022			1,450,000			1,415,414
Enterprise Products Operating LLC
3.750%, 02/15/2025
Callable 11/15/2024			2,000,000			1,983,364
Kinder Morgan Energy Partners, L.P.
4.250%, 09/01/2024
Callable 06/01/2024			3,000,000			3,010,216
Occidental Petroleum Corporation
2.600%, 04/15/2022
Callable 03/15/2022			3,125,000			3,056,902
Range Resources Corporation
5.000%, 08/15/2022
Callable 05/15/2022			5,850,000			5,820,750
						15,286,646
Real Estate Investment Trusts - 3.6%
American Tower Corporation:
3.400%, 02/15/2019			1,585,000			1,589,508
5.050%, 09/01/2020			1,250,000			1,292,578
3.500%, 01/31/2023			3,500,000			3,446,504
5.000%, 02/15/2024			2,500,000			2,595,750
						8,924,340
Road & Rail - 3.0%
Burlington Northern Santa Fe, LLC
3.000%, 03/15/2023
Callable 12/15/2022			3,300,000			3,239,931
Union Pacific Corporation
2.250%, 06/19/2020
Callable 05/19/2020			4,125,000			4,070,423
						7,310,354
Software & Services - 1.0%
Sabre GLBL Inc. (b)
5.375%, 04/15/2023
Callable 07/30/2018			2,500,000			2,537,500

The accompanying notes are an integral part of these financial statements.

20

LKCM FIXED INCOME FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

CORPORATE BONDS	Principal Amount			Value
Specialty Retail - 0.5%
O’Reilly Automotive, Inc.
4.875%, 01/14/2021
Callable 10/14/2020		$	1,128,000		$	1,165,642
TOTAL CORPORATE BONDS (Cost $186,699,062)				183,915,574
U.S. GOVERNMENT ISSUES - 7.0%
U.S. Treasury Inflation Indexed Bonds - 1.5%
0.625%, 01/15/2024			3,758,230			3,754,319
U.S. Treasury Notes - 5.5%
1.000%, 08/15/2018			2,000,000			1,997,897
1.250%, 10/31/2019			2,000,000			1,968,945
2.000%, 07/31/2020			2,000,000			1,977,930
2.000%, 02/15/2023			2,000,000			1,937,969
2.000%, 02/15/2025			2,000,000			1,902,500
2.000%, 08/15/2025			2,000,000			1,894,883
1.625%, 02/15/2026			2,000,000			1,835,195
						13,515,319
TOTAL U.S. GOVERNMENT ISSUES (Cost $17,790,032)				17,269,638
U.S. GOVERNMENT SPONSORED ENTITIES - 17.7%
Fannie Mae - 2.3%
1.500%, 07/28/2021
Callable 07/28/2018 (c)			2,000,000			1,976,556
1.500%, 10/26/2021
Callable 07/26/2018 (c)			1,040,000			1,018,716
1.500%, 05/17/2024
Callable 08/17/2018 (c)			2,800,000			2,732,582
						5,727,854
Federal Home Loan Bank - 5.0%
1.550%, 10/19/2020
Callable 10/19/2018 (c)			2,500,000			2,458,093
1.750%, 10/19/2020
Callable 07/19/2018 (c)			2,500,000			2,465,638
2.050%, 01/29/2021
Callable 01/29/2019 (c)			2,500,000			2,475,870
1.625%, 08/15/2022
Callable 08/15/2018 (c)			2,500,000			2,445,287
2.000%, 08/24/2022
Callable 08/24/2018			2,700,000			2,600,537
						12,445,425
Freddie Mac - 10.4%
1.375%, 08/25/2021
Callable 08/25/2018 (c)			1,650,000			1,599,970
1.500%, 08/25/2021
Callable 08/25/2018 (c)			1,600,000			1,536,754
1.750%, 08/25/2021
Callable 08/25/2018 (c)			2,500,000			2,452,222
2.375%, 01/13/2022			2,000,000			1,974,744

U.S. GOVERNMENT SPONSORED ENTITIES	Principal Amount			Value
Freddie Mac - 10.4%, Continued
2.200%, 07/27/2022
Callable 07/27/2018		$	1,225,000		$	1,191,023
1.625%, 09/29/2022
Callable 09/29/2018 (c)			2,500,000			2,457,333
2.000%, 12/14/2022
Callable 12/14/2018 (c)			2,000,000			1,983,644
2.000%, 12/27/2022
Callable 09/27/2018 (c)			2,200,000			2,179,547
2.250%, 02/28/2023
Callable 08/28/2018 (c)			2,000,000			1,989,550
1.500%, 06/30/2023
Callable 09/30/2018 (c)			1,500,000			1,455,525
2.000%, 10/27/2023
Callable 07/27/2018 (c)			4,500,000			4,418,645
2.000%, 05/23/2031
Callable 08/23/2018 (c)			2,500,000			2,391,742
						25,630,699
TOTAL U.S. GOVERNMENT SPONSORED ENTITIES (Cost $44,719,826)				43,803,978
SHORT-TERM INVESTMENT - 1.1%	Shares
Money Market Fund - 1.1%
Invesco Short-Term Investments Trust-Government & Agency Portfolio - Institutional Shares, 1.81% (d)			2,733,078			2,733,078
TOTAL SHORT-TERM INVESTMENT (Cost $2,733,078)				2,733,078
Total Investments - 100.1% (Cost $251,941,998)				247,722,268
Liabilities in Excess of Other Assets - (0.1)%						(216,174	)
TOTAL NET ASSETS - 100.0%				$247,506,094

(a) Floating rate.

(b) Rule 144A security. Resale to the public may require registration or may extend only to qualified institutional buyers. The fair market value of the Rule 144A securities was $2,534,375 representing 1.0% of the Fund’s total net assets.

(c) Step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate as of period end.

(d) The rate quoted is the annualized seven-day yield of the fund at period end.

Investments are classified by industry pursuant to the Global Industry Classification Standard (GICS^®), which was developed by and/or is the exclusive property of Morgan Stanley Capital International, Inc. (“MSCI”) and Standard & Poor’s Financial Services LLC (“S&P”). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.

The accompanying notes are an integral part of these financial statements.

21

STATEMENTOF ASSETSAND LIABILITIES

June 30, 2018 (Unaudited)

	LKCM Small Cap Equity Fund				LKCM Small-Mid Cap Equity Fund				LKCM Equity Fund			LKCM Balanced Fund			LKCM Fixed Income Fund
Assets:
Investments, at value*		$	210,231,036			$	17,213,383			$	346,237,581		$	86,082,720		$	247,722,268
Dividends and interest receivable			64,966				3,827				384,717			215,573			1,759,661
Receivable for fund shares sold			132,474				—				—			41,290			300,031
Prepaid trustee fees			11,336				337				18,710			4,522			14,033
Other assets			49,657				14,442				39,630			24,805			32,895
Total assets			210,489,469				17,231,989				346,680,638			86,368,910			249,828,888
Liabilities:
Payable for fund shares redeemed			857,679				2,059				3,177			30,884			2,044,701
Payable for investment advisory fees			333,433				—				463,940			98,211			125,676
Payable for investments purchased			113,222				—				—			—			—
Payable for accounting and transfer agent fees and expenses			39,207				14,832				36,310			16,252			39,766
Payable for administrative fees			29,589				6,888				45,859			11,853			34,636
Payable for professional fees			19,740				5,829				29,757			10,408			22,542
Payable for reports to shareholders			9,064				1,434				13,721			—			7,165
Payable for custody fees and expenses			3,828				931				5,492			1,546			4,484
Payable for distribution expense (Note B)			1,792				—				—			—			—
Accrued expenses and other liabilities			50,560				1,222				58,512			13,633			43,824
Total liabilities			1,458,114				33,195				656,768			182,787			2,322,794
Net assets		$	209,031,355			$	17,198,794			$	346,023,870		$	86,186,123		$	247,506,094
Net assets consist of:
Paid in capital		$	121,665,033			$	10,445,540			$	186,828,714		$	67,229,448		$	251,914,141
Undistributed net investment income (loss)			(291,732	)			(20,718	)			1,147,879			13,451			48,893
Accumulated net realized gain (loss) on securities			25,792,014				2,190,231				11,248,410			528,037			(237,210	)
Net unrealized appreciation (depreciation) on investments			61,866,040				4,583,741				146,798,867			18,415,187			(4,219,730	)
Net assets		$	209,031,355			$	17,198,794			$	346,023,870		$	86,186,123		$	247,506,094
INSTITUTIONAL CLASS
Net assets		$	208,401,393			$	17,198,794			$	346,023,870		$	86,186,123		$	247,506,094
Shares of beneficial interest outstanding (unlimited shares of no par value authorized)			10,230,535				1,531,463				12,642,949			3,839,748			23,614,320
Net asset value per share (offering and redemption price)		$	20.37			$	11.23			$	27.37		$	22.45		$	10.48
ADVISER CLASS**
Net assets		$	629,962
Shares of beneficial interest outstanding (unlimited shares of no par value authorized)			33,321
Net asset value per share (offering and redemption price)		$	18.91
* Cost of Investments			148,364,996				12,629,642				199,438,714			67,667,533			251,941,998

** Currently, Adviser Class shares are authorized only for the Small Cap Equity, Small-Mid Cap Equity and Equity Funds and are offered only by the Small Cap Equity Fund.

The accompanying notes are an integral part of these financial statements.

22

STATEMENTOF OPERATIONS

For the Six Months Ended June 30, 2018 (Unaudited)

	LKCM Small Cap Equity Fund				LKCM Small-Mid Cap Equity Fund				LKCM Equity Fund				LKCM Balanced Fund				LKCM Fixed Income Fund
Investment Income:
Dividends*		$	698,111			$	67,617			$	2,353,090			$	417,837			$	—
Interest			25,198				2,846				190,354				319,142				3,337,356
Total income			723,309				70,463				2,543,444				736,979				3,337,356
Expenses:
Investment advisory fees			760,735				68,386				1,226,479				273,261				618,981
Distribution expense – Adviser Class (Note B)			728				—				—				—				—
Accounting and transfer agent fees and expenses			103,875				42,970				121,546				49,865				97,244
Administrative fees			84,665				20,522				141,455				34,907				103,206
Professional fees			41,761				5,877				59,692				15,561				44,534
Trustees’ fees			34,835				3,717				46,773				10,792				34,961
Federal and state registration			26,915				12,500				22,843				11,003				21,094
Custody fees and expenses			12,096				3,288				17,974				4,575				13,293
Reports to shareholders			9,527				1,267				10,005				2,896				7,255
Other			49,315				4,163				65,031				15,038				48,642
Total expenses			1,124,452				162,690				1,711,798				417,898				989,210
Less, expense waiver and/or reimbursement (Note B)			(109,411	)			(71,509	)			(310,108	)			(81,577	)			(370,228	)
Net expenses			1,015,041				91,181				1,401,690				336,321				618,982
Net investment income (loss)			(291,732	)			(20,718	)			1,141,754				400,658				2,718,374
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain (loss) on investments			25,797,694				1,996,990				11,271,263				528,037				(237,210	)
Net change in unrealized appreciation/depreciation on investments			(5,064,521	)			(935,844	)			5,338,712				577,220				(4,491,784	)
Net realized and unrealized gain (loss) on investments			20,733,173				1,061,146				16,609,975				1,105,257				(4,728,994	)
Net Increase (Decrease) in Net Assets Resulting from Operations		$	20,441,441			$	1,040,428			$	17,751,729			$	1,505,915			$	(2,010,620	)
* Net of foreign taxes withheld		$	—			$	—			$	4,095			$	—			$	—

The accompanying notes are an integral part of these financial statements.

23

STATEMENTSOF CHANGESIN NET ASSETS

	LKCM Small Cap Equity Fund						LKCM Small-Mid Cap Equity Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017
Operations:
Net investment loss	$	(291,732	)	$	(419,914	)	$	(20,718	)	$	(36,019	)
Net realized gain on investments		25,797,694			41,104,589			1,996,990			2,497,041
Net change in unrealized appreciation/depreciation on investments		(5,064,521	)		(4,585,084	)		(935,844	)		1,824,006
Net increase in net assets resulting from operations		20,441,441			36,099,591			1,040,428			4,285,028
Dividends and Distributions to Institutional Class Shareholders:
Net realized gain on investments		—			(33,953,609	)		—			(2,141,026	)
Dividends and Distributions to Adviser Class Shareholders:
Net realized gain on investments		—			(91,957	)
Net decrease in net assets from Fund share transactions (Note C)		(13,072,566	)		(83,606,173	)		(3,219,750	)		(3,184,769	)
Total increase (decrease) in net assets		7,368,875			(81,552,148	)		(2,179,322	)		(1,040,767	)
Net Assets:
Beginning of period		201,662,480			283,214,628			19,378,116			20,418,883
End of period*	$	209,031,355		$	201,662,480		$	17,198,794		$	19,378,116
* Including accumulated net investment loss of	$	(291,732	)	$	—		$	(20,718	)	$	—

The accompanying notes are an integral part of these financial statements.

24

STATEMENTSOF CHANGESIN NET ASSETS

	LKCM Equity Fund									LKCM Balanced Fund
	Six Months Ended June 30, 2018 (Unaudited)					Year Ended December 31, 2017				Six Months Ended June 30, 2018 (Unaudited)				Year Ended December 31, 2017
Operations:
Net investment income		$	1,141,754				$	2,170,544			$	400,658			$	702,924
Net realized gain on investments			11,271,263					13,289,318				528,037				2,549,252
Net change in unrealized appreciation/depreciation on investments			5,338,712					46,722,416				577,220				5,751,978
Net increase in net assets resulting from operations			17,751,729					62,182,278				1,505,915				9,004,154
Dividends and Distributions to Shareholders					��
Net investment income			—					(2,175,595	)			(393,646	)			(700,479	)
Net realized gain on investments			—					(13,688,012	)			—				(2,524,332	)
			—					(15,863,607	)			(393,646	)			(3,224,811	)
Net increase (decrease) in net assets from Fund share transactions (Note C)			(12,329,213	)				7,774,360				1,644,141				14,458,317
Total increase in net assets			5,422,516					54,093,031				2,756,410				20,237,660
Net Assets:
Beginning of period			340,601,354					286,508,323				83,429,713				63,192,053
End of period*		$	346,023,870				$	340,601,354			$	86,186,123			$	83,429,713
* Including accumulated net investment income of		$	1,147,879				$	6,125			$	13,451			$	6,439

The accompanying notes are an integral part of these financial statements.

25

STATEMENTSOF CHANGESIN NET ASSETS

	LKCM Fixed Income Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017
Operations:
Net investment income	$	2,718,374		$	4,694,614
Net realized gain (loss) on investments		(237,210	)		231,170
Net change in unrealized appreciation/depreciation on investments		(4,491,784	)		144,349
Net increase (decrease) in net assets resulting from operations		(2,010,620	)		5,070,133
Dividends and Distributions to Shareholders:
Net investment income		(2,669,481	)		(4,704,142	)
Net realized gain on investments		—			(239,922	)
		(2,669,481	)		(4,944,064	)
Net increase in net assets from Fund share transactions (Note C)		3,210,391			21,987,467
Total increase (decrease) in net assets		(1,469,710	)		22,113,536
Net Assets:
Beginning of period		248,975,804			226,862,268
End of period*	$	247,506,094		$	248,975,804
* Including accumulated net investment income of	$	48,893		$	—

The accompanying notes are an integral part of these financial statements.

26

FINANCIAL HIGHLIGHTS

SELECTED DATAFOR EACH SHAREOF CAPITAL STOCK OUTSTANDING

	LKCM Small Cap Equity Fund – Institutional Class
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013
Net Asset Value – Beginning of Period	$	18.44		$	18.82		$	19.86		$	24.05		$	28.33		$	22.69
Net investment income (loss)		(0.03	)		(0.04	)		(0.03	)(1)		0.01			(0.06	)(1)		(0.06)	(2)
Net realized and unrealized gain (loss) on investments		1.96			3.27			1.88			(1.29	)		(0.77	)		8.02
Total from investment operations		1.93			3.23			1.85			(1.28	)		(0.83	)		7.96
Dividends from net investment income		—			—			—			(0.01	)		—			—
Distributions from net realized gains		—			(3.61	)		(2.89	)		(2.90	)		(3.45	)		(2.32	)
Total dividends and distributions		—			(3.61	)		(2.89	)		(2.91	)		(3.45	)		(2.32	)
Net Asset Value – End of Period	$	20.37		$	18.44		$	18.82		$	19.86		$	24.05		$	28.33
Total Return		10.47%	(4)		17.04%			9.27%			-5.58%			-3.11%			35.11%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	208,401		$	201,139		$	281,790		$	568,421		$	840,631		$	1,047,607
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		1.11%	(5)		1.10%			0.95%			0.97%			0.94%			0.95%
After expense waiver and/or reimbursement		1.00%	(5)		1.00%			1.00%			0.97%			0.94%			0.95%
Ratio of net investment income (loss) to average net assets:
Before expense waiver and/or reimbursement		(0.40)%	(5)		(0.28)%			(0.08)%			0.05%			(0.21)%			(0.23)%
After expense waiver and/or reimbursement		(0.29)%	(5)		(0.18)%			(0.13)%			0.05%			(0.21)%			(0.23)%
Portfolio turnover rate(3)		25%			42%			50%			62%			60%			47%

⁽¹⁾  Net investment income (loss) per share represents net investment income (loss) divided by the average shares outstanding throughout the period.

⁽²⁾  Net investment loss per share is calculated using the ending balance of undistributed net investment loss prior to considerations of adjustments for permanent book and tax differences.

⁽³⁾  Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

⁽⁴⁾  Not annualized.

⁽⁵⁾  Annualized.

	LKCM Small Cap Equity Fund – Adviser Class
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013
Net Asset Value – Beginning of Period	$	17.13		$	17.76		$	18.93		$	23.11		$	27.43		$	22.07
Net investment loss		(0.05	)		(0.08	)		(0.07	)(1)		(0.05	)		(0.12	)(1)		(0.13	)(2)
Net realized and unrealized gain (loss) on investments		1.83			3.06			1.79			(1.23	)		(0.75	)		7.81
Total from investment operations		1.78			2.98			1.72			(1.28	)		(0.87	)		7.68
Distributions from net realized gains		—			(3.61	)		(2.89	)		(2.90	)		(3.45	)		(2.32	)
Net Asset Value – End of Period	$	18.91		$	17.13		$	17.76		$	18.93		$	23.11		$	27.43
Total Return		10.39%	(4)		16.70%			8.99%			-5.81%			-3.35%			34.81%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	630		$	524		$	1,425		$	8,598		$	14,665		$	41,153
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		1.36%	(5)		1.35%			1.20%			1.22%			1.19%			1.20%
After expense waiver and/or reimbursement		1.25%	(5)		1.25%			1.25%			1.22%			1.19%			1.20%
Ratio of net investment income (loss) to average net assets:
Before expense waiver and/or reimbursement		(0.65)%	(5)		0.53%			(0.33)%			(0.20)%			(0.46)%			(0.48)%
After expense waiver and/or reimbursement		(0.54)%	(5)		0.48%			(0.38)%			(0.20)%			(0.46)%			(0.48)%
Portfolio turnover rate(3)		25%			42%			50%			62%			60%			47%

⁽¹⁾  Net investment income (loss) per share represents net investment income (loss) divided by the average shares outstanding throughout the period.

⁽²⁾  Net investment loss per share is calculated using the ending balance of undistributed net investment loss prior to considerations of adjustments for permanent book and tax differences.

⁽³⁾  Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.

⁽⁴⁾  Not annualized.

⁽⁵⁾  Annualized.

The accompanying notes are an integral part of these financial statements.

27

FINANCIAL HIGHLIGHTS

SELECTED DATAFOR EACH SHAREOF CAPITAL STOCK OUTSTANDING

	LKCM Small-Mid Cap Equity Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013
Net Asset Value – Beginning of Period	$	10.60		$	9.56		$	11.15		$	12.10		$	12.97		$	9.68
Net investment loss		(0.01	)		(0.01	)(1)		(0.05	)(1)		(0.06	)(2)		(0.08	)(1)		(0.06	)(2)
Net realized and unrealized gain (loss) on investments		0.64			2.32			0.19			(0.10	)		(0.48	)		3.35
Total from investment operations		0.63			2.31			0.14			(0.16	)		(0.56	)		3.29
Distributions from net realized gains		—			(1.27	)		(1.73	)		(0.79	)		(0.31	)		—
Net Asset Value – End of Period	$	11.23		$	10.60		$	9.56		$	11.15		$	12.10		$	12.97
Total Return		5.94%	(3)		24.13%			1.17%			-1.41%			-4.39%			33.99%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	17,199		$	19,378		$	20,419		$	331,954		$	391,668		$	366,423
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		1.78%	(4)		1.76%			1.23%			1.14%			1.20%			1.18%
After expense waiver and/or reimbursement		1.00%	(4)		1.00%			1.00%			1.00%			1.00%			1.00%
Ratio of net investment loss to average net assets:
Before expense waiver and/or reimbursement		(1.01)%	(4)		(0.91)%			(0.68)%			(0.63)%			(0.82)%			(0.77)%
After expense waiver and/or reimbursement		(0.23)%	(4)		(0.18)%			(0.45)%			(0.49)%			(0.62)%			(0.59)%
Portfolio turnover rate		24%			63%			80%			70%			72%			49%

⁽¹⁾  Net investment loss per share represents net investment loss divided by the average shares outstanding throughout the period.

⁽²⁾  Net investment loss per share is calculated using the ending balance of undistributed net investment loss prior to considerations of adjustments for permanent book and tax differences.

⁽³⁾  Not annualized.

⁽⁴⁾  Annualized.

	LKCM Equity Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013 (1)
Net Asset Value – Beginning of Period	$	26.02		$	22.42		$	21.40		$	22.81		$	22.44		$	17.62
Net investment income		0.09			0.17			0.19	(2)		0.18	(2)		0.17	(3)		0.14	(2)
Net realized and unrealized gain (loss) on investments		1.26			4.69			2.32			(0.98	)		1.28			5.27
Total from investment operations		1.35			4.86			2.51			(0.80	)		1.45			5.41
Dividends from net investment income		—			(0.17	)		(0.20	)		(0.20	)		(0.16	)		(0.12	)
Distributions from net realized gains		—			(1.09	)		(1.29	)		(0.41	)		(0.92	)		(0.47	)
Total dividends and distributions		—			(1.26	)		(1.49	)		(0.61	)		(1.08	)		(0.59	)
Net Asset Value – End of Period	$	27.37		$	26.02		$	22.42		$	21.40		$	22.81		$	22.44
Total Return		5.19%	(4)		21.69%			11.66%			-3.54%			6.40%			30.74%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	346,024		$	340,601		$	286,508		$	281,200		$	333,692		$	323,932
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		0.98%	(5)		0.99%			0.98%			0.93%			0.92%			0.93%
After expense waiver and/or reimbursement		0.80%	(5)		0.80%			0.80%			0.80%			0.80%			0.80%
Ratio of net investment income to average net assets:
Before expense waiver and/or reimbursement		0.47%	(5)		0.50%			0.69%			0.68%			0.59%			0.53%
After expense waiver and/or reimbursement		0.65%	(5)		0.69%			0.87%			0.81%			0.71%			0.66%
Portfolio turnover rate		7%			11%			16%			13%			14%			17%

⁽¹⁾  On May 10, 2013, the Armstrong Fund was reorganized into the LKCM Equity Fund. Activity after May 10, 2013 reflects the Funds’ combined operations.

⁽²⁾  Net investment income per share represents net investment income divided by the average shares outstanding throughout the period.

⁽³⁾  Net investment income per share is calculated using the ending balance of undistributed net investment income prior to considerations of adjustments for permanent book and tax differences.

⁽⁴⁾  Not annualized.

⁽⁵⁾  Annualized.

The accompanying notes are an integral part of these financial statements.

28

FINANCIAL HIGHLIGHTS

SELECTED DATAFOR EACH SHAREOF CAPITAL STOCK OUTSTANDING

	LKCM Balanced Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013
Net Asset Value – Beginning of Period	$	22.18		$	20.46		$	19.60		$	20.10		$	19.63		$	16.11
Net investment income		0.10			0.20			0.20	(1)		0.19			0.24			0.17
Net realized and unrealized gain (loss) on investments		0.27			2.43			1.69			(0.00	)(2)		0.94			3.55
Total from investment operations		0.37			2.63			1.89			0.19			1.18			3.72
Dividends from net investment income		(0.10	)		(0.20	)		(0.18	)		(0.19	)		(0.24	)		(0.17	)
Distributions from net realized gains		—			(0.71	)		(0.85	)		(0.50	)		(0.47	)		(0.03	)
Total dividends and distributions		(0.10	)		(0.91	)		(1.03	)		(0.69	)		(0.71	)		(0.20	)
Net Asset Value – End of Period	$	22.45		$	22.18		$	20.46		$	19.60		$	20.10		$	19.63
Total Return		1.69%	(3)		12.88%			9.70%			0.91%			5.99%			23.18%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	86,186		$	83,430		$	63,192		$	39,153		$	37,028		$	35,332
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		0.99%	(4)		1.02%			1.03%			1.02%			0.99%			1.04%
After expense waiver and/or reimbursement		0.80%	(4)		0.80%			0.80%			0.80%			0.80%			0.80%
Ratio of net investment income to average net assets:
Before expense waiver and/or reimbursement		0.76%	(4)		0.73%			0.73%			0.73%			1.02%			0.72%
After expense waiver and/or reimbursement		0.95%	(4)		0.95%			0.96%			0.95%			1.21%			0.96%
Portfolio turnover rate		5%			15%			16%			16%			20%			10%

⁽¹⁾  Net investment income per share represents net investment income divided by the average shares outstanding throughout the period.

⁽²⁾  Less than $(0.005).

⁽³⁾  Not annualized.

⁽⁴⁾  Annualized.

	LKCM Fixed Income Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013
Net Asset Value – Beginning of Period	$	10.68		$	10.67		$	10.50		$	10.82		$	10.91		$	11.23
Net investment income		0.11			0.21			0.23			0.25	(1)		0.22			0.27
Net realized and unrealized gain (loss) on investments		(0.20	)		0.02			0.17			(0.28	)		(0.03	)		(0.26	)
Total from investment operations		(0.09	)		0.23			0.40			(0.03	)		0.19			0.01
Dividends from net investment income		(0.11	)		(0.21	)		(0.23	)		(0.26	)		(0.22	)		(0.27	)
Distributions from net realized gains		—			(0.01	)		(0.00	)(2)		(0.03	)		(0.06	)		(0.06	)
Total dividends and distributions		(0.11	)		(0.22	)		(0.23	)		(0.29	)		(0.28	)		(0.33	)
Net Asset Value – End of Period	$	10.48		$	10.68		$	10.67		$	10.50		$	10.82		$	10.91
Total Return		(0.81)%	(4)		2.15%			3.83%			-0.27%			1.72%			0.07%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	247,506		$	248,976		$	226,862		$	198,841		$	222,704		$	221,104
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		0.80%	(5)		0.80%			0.78%			0.73%	(3)		0.70%			0.72%
After expense waiver and/or reimbursement		0.50%	(5)		0.50%			0.50%			0.56%	(3)		0.65%			0.65%
Ratio of net investment income to average net assets:
Before expense waiver and/or reimbursement		1.90%	(5)		1.66%			1.86%			2.18%	(3)		1.92%			2.34%
After expense waiver and/or reimbursement		2.20%	(5)		1.96%			2.14%			2.35%	(3)		1.97%			2.41%
Portfolio turnover rate		13%			28%			59%			29%			46%			30%

⁽¹⁾  Net investment income per share represents net investment income divided by the average shares outstanding during the period.

⁽²⁾  Less than $(0.005).

⁽³⁾  Effective May 22, 2015, the Adviser contractually agreed to lower the expense cap for the Fund from 0.65% to 0.50% of the Fund’s average daily net assets.

⁽⁴⁾  Not annualized.

⁽⁵⁾  Annualized.

The accompanying notes are an integral part of these financial statements.

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LKCM FUNDS

NOTESTOTHE FINANCIAL STATEMENTS (UNAUDITED)

A.    Organization and Significant Accounting Policies:    LKCM Funds (the “Trust”) is registered under the Investment Company Act of 1940 (“1940 Act”) as an open-end, management investment company. The Trust was organized as a Delaware statutory trust on February 10, 1994 and consists of six diversified series, five of which are presented herein and include the LKCM Small Cap Equity Fund, LKCM Small-Mid Cap Equity Fund, LKCM Equity Fund, LKCM Balanced Fund and LKCM Fixed Income Fund (collectively, the “Funds”). The assets of the Funds are invested in separate, independently managed portfolios. Investment operations of the Funds began on July 14, 1994 (LKCM Small Cap Equity Fund—Institutional Class Shares), January 3, 1996 (LKCM Equity Fund—Institutional Class Shares), December 30, 1997 (LKCM Balanced Fund and LKCM Fixed Income Fund), and May 2, 2011 (LKCM Small-Mid Cap Equity Fund—Institutional and Adviser Class Shares). The LKCM Small Cap Equity Fund and the LKCM Equity Fund created a second class of shares, Adviser Class Shares, and renamed the initial class as Institutional Class Shares on May 1, 2003. The LKCM Small Cap Equity Fund—Adviser Class Shares were initially sold on June 5, 2003 and are subject to expenses pursuant to the Rule 12b-1 plan described in Note B. The Adviser Class Shares of the LKCM Equity Fund and LKCM Small-Mid Cap Equity Fund have not yet commenced operations. Each Fund charges a 1% redemption fee for redemptions on Fund shares held for less than 30 days, unless otherwise determined by a Fund in its discretion.

The LKCM Small Cap Equity Fund seeks to maximize long-term capital appreciation by investing under normal circumstances at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of smaller companies (those with market capitalizations at the time of investment between $600 million and $4.5 billion) which Luther King Capital Management Corporation (the “Adviser”) believes are likely to have above-average growth in revenue and/or earnings and potential for above-average capital appreciation. The LKCM Small-Mid Cap Equity Fund seeks to maximize long-term capital appreciation by investing under normal circumstances at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of small-mid capitalization companies (those with market capitalizations at the time of investment between $1.25 billion and $10 billion) which the Adviser believes are likely to have above-average growth in revenue and/or earnings and potential for above-average capital appreciation. The LKCM Equity Fund seeks to maximize long-term capital appreciation by investing under normal circumstances at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of companies which the Adviser believes are likely to have above-average growth in revenue and/or earnings, above-average returns on shareholders’ equity, potential for above-average capital appreciation and/or companies that the Adviser believes have attractive relative valuations. The LKCM Balanced Fund seeks current income and long-term capital appreciation by investing primarily in a portfolio of equity and fixed income securities with at least 25% of the Fund’s total assets invested in fixed income securities under normal circumstances. The LKCM Fixed Income Fund seeks current income by investing under normal circumstances at least 80% of its net assets (plus any borrowings for investment purposes) in a portfolio of investment grade corporate and U.S. government fixed income securities.

The following is a summary of significant accounting policies followed by the Funds in preparation of the financial statements. The Funds are investment companies and, accordingly, follow the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standards Codification Topic 946, Investment Companies.

1.    Security Valuation:    Equity securities listed or traded on a U.S. securities exchange for which market quotations are readily available are valued at the last quoted sale price on the exchange on which the security is primarily traded. Nasdaq Global Market securities are valued at the Nasdaq Official Closing Price (“NOCP”). Unlisted U.S. securities and listed U.S. securities not traded on a particular valuation date are valued at the mean of the most recent quoted bid and ask price on the relevant exchanges or markets. Equity securities listed on a foreign exchange for which market quotations are readily available are valued at the last quoted sales price on the exchange on which the security is primarily traded. Debt securities are normally valued at the mean of the closing bid and ask price and/or by using a combination of broker quotations or evaluated prices provided by an independent pricing service. Other assets and securities for which no market or broker quotations or evaluated prices are readily available (including restricted securities) are valued in good faith at fair value using guidelines approved by the Board of Trustees. The Board has adopted specific guidelines and procedures for valuing portfolio securities and delegated their implementation to the Adviser. The guidelines and procedures authorize the Adviser to make determinations regarding the fair value of a portfolio security and to report such determinations to the Board of Trustees. The Funds may use prices provided by independent pricing services to assist in the fair valuation of the Funds’ portfolio securities.

The Trust has adopted accounting standards which establish an authoritative definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion of changes in valuation techniques and related inputs during the period. These standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy is organized into three levels based upon the assumptions (referred to as “inputs”) used in pricing the asset or liability. These standards state that “observable inputs” reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from independent sources and “unobservable inputs” reflect an entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability. These inputs are summarized in the three broad levels listed below.

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Level 1	–	Quoted unadjusted prices for identical instruments in active markets to which the Trust has access at the date of measurement.
Level 2	–	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, little public information exists or instances where prices vary substantially over time or among brokered market makers.
Level 3	–	Model derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Trust’s own assumptions that market participants would use to price the asset or liability based on the best available information.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. As of June 30, 2018, the Funds’ assets carried at fair value were classified as follows:

LKCM Small Cap Equity Fund
Description	Level 1			Level 2			Level 3			Total
Common Stocks		$	204,577,218		$	—		$	—		$	204,577,218
Money Market Fund			5,653,818			—			—			5,653,818
Total Investments*		$	210,231,036		$	—		$	—		$	210,231,036
LKCM Small-Mid Cap Equity Fund
Description	Level 1			Level 2			Level 3			Total
Common Stocks		$	16,840,743		$	—		$	—		$	16,840,743
Money Market Fund			372,640			—			—			372,640
Total Investments*		$	17,213,383		$	—		$	—		$	17,213,383
LKCM Equity Fund
Description	Level 1			Level 2			Level 3			Total
Common Stocks		$	329,350,454		$	—		$	—		$	329,350,454
U.S. Government Issue			—			9,925,586			—			9,925,586
Money Market Fund			6,961,541			—			—			6,961,541
Total Investments*		$	336,311,995		$	9,925,586		$	—		$	346,237,581
LKCM Balanced Fund
Description	Level 1			Level 2			Level 3			Total
Common Stocks		$	57,347,199		$	—		$	—		$	57,347,199
Corporate Bonds			—			27,402,681			—			27,402,681
Money Market Fund			1,332,840			—			—			1,332,840
Total Investments*		$	58,680,039		$	27,402,681		$	—		$	86,082,720
LKCM Fixed Income Fund
Description	Level 1			Level 2			Level 3			Total
Corporate Bonds		$	—		$	183,915,574		$	—		$	183,915,574
U.S. Government Sponsored Entities			—			43,803,978			—			43,803,978
U.S. Government Issues			—			17,269,638			—			17,269,638
Money Market Fund			2,733,078			—			—			2,733,078
Total Investments*		$	2,733,078		$	244,989,190		$	—		$	247,722,268

* Additional information regarding the industry classifications of these investments is disclosed in the Schedule of Investments.

There were no transfers into or out of Level 1, Level 2 or Level 3 fair value measurements during the reporting period. Transfers between levels are recognized at the end of the reporting period.

2.    Federal Income Taxes:    The Funds have elected to be treated as “regulated investment companies” under Subchapter M of the Internal Revenue Code and each Fund intends to distribute all of its investment company net taxable income and net capital gains to shareholders. Therefore, no federal income tax provision is recorded.

3.    Distributions to Shareholders:    The LKCM Small Cap Equity Fund, LKCM Small-Mid Cap Equity Fund and LKCM Equity Fund generally intend to pay dividends and distribute net capital, if any, at least on an annual basis. The LKCM Balanced Fund and LKCM Fixed Income Fund generally intend to pay dividends on a quarterly basis and distribute net capital, if any, at least on an annual basis.

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4.    Foreign Securities:    Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in securities of U.S. issuers. These risks include devaluation of currencies and future adverse political and economic developments. Moreover, securities of many foreign companies and foreign governments and their markets may be less liquid and their prices more volatile than those of securities of comparable U.S. companies and securities of the U.S. government.

5.    Expense Allocation:    Expenses incurred by the Funds are allocated among the Funds based upon (i) relative average net assets, (ii) a specific identification basis as incurred, or (iii) evenly among the Funds, depending on the nature of the expense. Expenses that are directly attributable to a class of shares, such as Rule 12b-1 distribution fees, are charged to that class. For multi-class Funds, income, unrealized and realized gains/losses are generally allocated between each Fund’s classes in proportion to its respective net assets.

6.    Use of Estimates:    The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

7.    Guarantees and Indemnifications:    In the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims against the Funds that have not yet occurred. Based on experience, the Funds expect the risk of loss to be remote.

8.    Security Transactions and Investment Income:    Security and shareholder transactions are recorded on the trade date. Realized gains and losses on sales of investments are calculated on the identified cost basis. Dividend income and dividends and distributions to shareholders are recorded on the ex-dividend date. Withholding taxes on foreign dividends have been provided for in accordance with the Funds’ understanding of the applicable jurisdiction’s tax rules and rates. Interest income is recognized on the accrual basis. All discounts and premiums are amortized based on the effective interest method for tax and financial reporting purposes. The Funds may hold the securities of real estate investment trusts (“REITs”). Distributions from such investments may include income, capital gains and return of capital.

9.    Other:    Generally accepted accounting principles require that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share.

10.    Restricted and Illiquid Securities:    The Funds are permitted to invest in securities that are subject to legal or contractual restrictions on resale including investments considered by the Funds to be illiquid. Restricted securities generally may be resold in transactions exempt from registration. Illiquid investments are investments that cannot be sold or disposed of within seven days in the ordinary course of business at approximately the prices at which they are valued. A security may be considered illiquid if it lacks a readily available market or if its valuation has not changed for a certain period of time. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at the current valuation may be difficult.

B.    Investment Advisory and Other Agreements:    The Adviser serves as the investment adviser to the Funds under an Investment Advisory Agreement (the “Agreement”). The Adviser receives a fee, computed daily and payable quarterly, at the annual rates presented below as applied to each Fund’s average daily net assets. The Adviser has contractually agreed to waive all or a portion of its management fee and/or reimburse expenses of the Funds through May 1, 2019 in order to limit each Fund’s operating expenses to the annual cap rates presented below. This expense limitation excludes interest, taxes, brokerage commissions, indirect fees and expenses relating to investments in other investment companies, including money market funds, and extraordinary expenses. For the six months ended June 30, 2018, the Adviser waived the following management fees to meet its expense cap obligations:

	LKCM Small Cap Equity Fund			LKCM Small-Mid Cap Equity Fund		LKCM Equity Fund		LKCM Balanced Fund		LKCM Fixed Income Fund
Annual Management Fee Rate		0.75%			0.75%		0.70%		0.65%		0.50%
Annual Cap on Expenses		1.00%	(Inst.)		1.00%		0.80%		0.80%		0.50%
		1.25%	(Adviser)
Fees Waived in 2018		$109,411			$71,509		$310,108		$81,577		$370,228

U.S. Bancorp Fund Services, LLC serves as transfer agent and administrator for the Trust and serves as accounting services agent for the Trust. U.S. Bank, N.A. serves as custodian for the Funds.

Distribution services are performed pursuant to a distribution contract with Quasar Distributors, LLC, the Trust’s principal underwriter.

The Small Cap Equity Fund, Small-Mid Cap Equity Fund and Equity Fund have adopted a Rule 12b-1 plan under which the Adviser Class of each Fund may pay up to 1.00% of its average daily net assets for distribution and other services. However, the Board of Trustees has currently only authorized a fee of 0.25% of each Fund’s average daily net assets. For the six months ended June 30, 2018,

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fees incurred by the Adviser Class shares of the Small Cap Equity Fund pursuant to the 12b-1 Plan were $728. The Adviser Class shares of the Equity Fund and the Small-Mid Cap Equity Fund have not yet commenced operations. The Funds have also adopted an Institutional Class Distribution Plan, under which each Fund may pay up to 0.75% of its average daily net assets for distribution and other services. Currently, the Board of Trustees has not authorized payments under this plan and, as a result, the Funds currently neither accrue nor pay any fees under the plan.

C.    Fund Shares:    At June 30, 2018, there was an unlimited number of shares of beneficial interest, no par value, authorized. The following table summarizes the activity in shares of each Fund:

LKCM Small Cap Equity Fund
	Six Months Ended June 30, 2018							Year Ended December 31, 2017
	Institutional Class							Institutional Class
	Shares			Amount				Shares			Amount
Shares sold		357,974			$	6,960,784			598,963			$	11,823,528
Shares issued to shareholders in reinvestment of distributions		—				—			1,603,959				29,785,514
Shares redeemed		(1,036,549	)			(20,080,335	)		(6,263,343	)			(124,254,603	)
Redemption fee						704							405
Net decrease		(678,575	)		$	(13,118,847	)		(4,060,421	)		$	(82,645,156	)
Shares Outstanding:
Beginning of period		10,909,110							14,969,531
End of period		10,230,535							10,909,110
	Six Months Ended June 30, 2018							Year Ended December 31, 2017
	Adviser Class							Adviser Class
	Shares			Amount				Shares			Amount
Shares sold		8,110			$	141,543			10,948			$	201,415
Shares issued to shareholders in reinvestment of distributions		—				—			4,941				85,287
Shares redeemed		(5,362	)			(95,262	)		(65,546	)			(1,247,757	)
Redemption fee						—							38
Net increase (decrease)		2,748			$	46,281			(49,657	)		$	(961,017	)
Shares Outstanding:
Beginning of period		30,573							80,230
End of period	��	33,321							30,573
Total Net Decrease					$	(13,072,566	)					$	(83,606,173	)
LKCM Small-Mid Cap Equity Fund
	Six Months Ended June 30, 2018							Year Ended December 31, 2017
	Shares			Amount				Shares			Amount
Shares sold		30,553			$	331,056			41,018			$	419,890
Shares issued to shareholders in reinvestment of distributions		—				—			191,420				2,038,623
Shares redeemed		(327,741	)			(3,550,806	)		(538,797	)			(5,643,282	)
Redemption fee						—							—
Net decrease		(297,188	)		$	(3,219,750	)		(306,359	)		$	(3,184,769	)
Shares Outstanding:
Beginning of period		1,828,651							2,135,010
End of period		1,531,463							1,828,651

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LKCM Equity Fund
	Six Months Ended June 30, 2018							Year Ended December 31, 2017
	Shares			Amount				Shares			Amount
Shares sold		497,482			$	13,467,132			1,035,601			$	24,847,728
Shares issued to shareholders in reinvestment of distributions		—				—			591,475				15,455,230
Shares redeemed		(946,132	)			(25,796,645	)		(1,315,094	)			(32,528,607	)
Redemption fee						300							9
Net increase (decrease)		(448,650	)		$	(12,329,213	)		311,982			$	7,774,360
Shares Outstanding:
Beginning of period		13,091,599							12,779,617
End of period		12,642,949							13,091,599
LKCM Balanced Fund
	Six Months Ended June 30, 2018							Year Ended December 31, 2017
	Shares			Amount				Shares			Amount
Shares sold		319,092			$	7,102,018			813,071			$	17,440,089
Shares issued to shareholders in reinvestment of distributions		17,127				378,488			140,839				3,117,892
Shares redeemed		(258,105	)			(5,836,988	)		(281,572	)			(6,099,690	)
Redemption fee						623							26
Net increase		78,114			$	1,644,141			672,338			$	14,458,317
Shares Outstanding:
Beginning of period		3,761,634							3,089,296
End of period		3,839,748							3,761,634
LKCM Fixed Income Fund
	Six Months Ended June 30, 2018							Year Ended December 31, 2017
	Shares			Amount				Shares			Amount
Shares sold		886,585			$	9,371,925			3,874,860			$	41,668,069
Shares issued to shareholders in reinvestment of distributions		227,292				2,385,260			444,230				4,756,374
Shares redeemed		(812,668	)			(8,546,794	)		(2,276,905	)			(24,437,044	)
Redemption fee						—							68
Net increase		301,209			$	3,210,391			2,042,185			$	21,987,467
Shares Outstanding:
Beginning of period		23,313,111							21,270,926
End of period		23,614,320							23,313,111

D.    Security Transactions:    Purchases and sales of investment securities, other than short-term investments, for the six months ended June 30, 2018 were as follows:

	Purchases				Sales
	U.S. Government		Other		U.S. Government		Other
LKCM Small Cap Equity Fund	$	—	$	49,629,641	$	—	$	67,346,361
LKCM Small-Mid Cap Equity Fund		—		4,326,984		—		7,837,363
LKCM Equity Fund		9,914,453		18,480,711		—		23,081,273
LKCM Balanced Fund		—		8,283,228		—		4,233,972
LKCM Fixed Income Fund		13,618,550		29,134,983		7,769,492		24,096,408

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E.    Tax Information:    At December 31, 2017, the components of accumulated earnings (losses) on a tax basis were as follows:

	LKCM Small Cap Equity Fund				LKCM Small-Mid Cap Equity Fund				LKCM Equity Fund				LKCM Balanced Fund				LKCM Fixed Income Fund
Cost of Investments		$	135,215,294			$	13,915,408			$	198,377,443			$	63,909,700			$	246,969,274
Gross Unrealized Appreciation		$	67,581,337			$	5,524,827			$	143,554,392			$	18,605,086			$	1,983,819
Gross Unrealized Depreciation			(656,456	)			(5,242	)			(2,094,237	)			(767,119	)			(1,711,765	)
Net Unrealized Appreciation		$	66,924,881			$	5,519,585			$	141,460,155			$	17,837,967			$	272,054
Undistributed Ordinary Income			—				—				6,125				6,439				—
Undistributed Long-Term Capital Gain			—				193,937				2,432				—				—
Total Distributable Earnings		$	—			$	193,937			$	8,557			$	6,439			$	—
Other Accumulated Losses		$	—			$	(696	)		$	(25,285	)		$	—			$	—
Total Accumulated Gains		$	66,924,881			$	5,712,826			$	141,443,427			$	17,844,406			$	272,054

The difference between book-basis and tax-basis unrealized appreciation, if any, is attributable primarily to the tax deferral of losses on wash sales.

To the extent the Funds realize future net capital gains, taxable distributions will be reduced by any unused capital loss carryforwards as permitted by the Internal Revenue Code. The Funds currently have no capital loss carryforwards.

At December 31, 2017, the LKCM Equity Fund deferred, on a tax basis, post-October capital losses of $25,285.

The tax components of dividends paid during the periods shown below were as follows:

	Six Months Ended June 30, 2018						Year Ended December 31, 2017
	Ordinary Income			Long-Term Capital Gains			Ordinary Income			Long-Term Capital Gains
LKCM Small Cap Equity Fund		$	—		$	—		$	424,898		$	33,620,668
LKCM Small-Mid Cap Equity Fund			—			—			—			2,141,026
LKCM Equity Fund			—			—			2,564,467			13,299,140
LKCM Balanced Fund			393,646			—			700,479			2,524,332
LKCM Fixed Income Fund			2,669,481			—			4,758,543			185,521

The Funds designated as long-term capital gain dividend, pursuant to Internal Revenue Code Section 852(b)(3), the amount necessary to reduce earnings and profits of the Funds related to net capital gain to zero for the tax years ended December 31, 2017 and 2016. The Funds designated earnings and profits distributed to shareholders upon the redemption of shares during 2017 and 2016 in determining undistributed net capital gains as of December 31, 2017 and 2016.

The Trust has adopted financial reporting rules regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Trust has reviewed all open tax years and major jurisdictions and concluded that there is no impact on the Funds’ financial position or results of operations. Tax years that remain open to examination by major tax jurisdictions include tax years ended

December 31, 2014 through December 31, 2017. There is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on tax returns as of December 31, 2017. The Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. If applicable, the Funds would recognize interest accrued related to unrecognized tax benefits in “interest expense” and penalties in “other expense” on the statement of operations.

F.    Subsequent Events:    In preparing these financial statements, the Trust has evaluated events after June 30, 2018 and determined that there were no significant subsequent events that would require adjustment to or additional disclosure in these financial statements.

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LKCM FUNDS

ADDITIONAL INFORMATION

June 30, 2018 (Unaudited)

Availability of Proxy Voting Information:    A description of the policies and procedures that the Funds use to determine how to vote proxies relating to their portfolio securities, as well as information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, is available without charge, upon request, by calling toll-free 1-800-688-LKCM or on the SEC website at http://www.sec.gov.

The actual voting records relating to portfolio securities during the twelve month period ended June 30 (as filed with the SEC on Form N-PX) are available without charge, upon request, by calling the Funds toll free at 1-800-688-LKCM or by accessing the SEC’s website at www.sec.gov.

Availability of Quarterly Portfolio Schedule:    The Funds are required to file complete schedules of portfolio holdings with the SEC for the first and third fiscal quarters on Form N-Q. Once filed, the Funds’ Form N-Q is available without charge upon request on the SEC’s website (http://www.sec.gov) and is also available by calling 1-800-688-LKCM. You can also review and copy the Funds’ Form N-Q by visiting the SEC’s Public Reference Room in Washington, DC (information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330).

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RENEWAL OF INVESTMENT ADVISORY AGREEMENT

WITH RESPECT TO LKCM FUNDS

Introduction. At a meeting held on February 27, 2018, the Board of Trustees of LKCM Funds, including the independent Trustees (the “Board”), approved the renewal of the Investment Advisory Agreement (the “Agreement”) between Luther King Capital Management Corporation (“LKCM”) and LKCM Funds (the “Trust”), on behalf of the LKCM Small Cap Equity Fund, LKCM Small-Mid Cap Equity Fund, LKCM Equity Fund, LKCM Balanced Fund and LKCM Fixed Income Fund (each, a “Fund” and collectively, the “Funds”).

In voting to approve the renewal of the Agreement, the Board considered information furnished throughout the year at regularly scheduled Board meetings, as well as information prepared specifically in connection with the annual renewal process. The Board also considered the overall fairness of the Agreement and factors it deemed relevant with respect to each Fund, including, but not limited to: (1) the nature, extent and quality of the services provided to each Fund; (2) the performance of each Fund as compared to a relevant benchmark, peer group of funds compiled by Lipper, Inc. (“Lipper”) and a composite (“Composite”) of accounts managed by LKCM pursuant to similar investment strategies (“Similar Accounts”); (3) the level of the fees and the overall expenses of each Fund and how those compared to a peer group of funds compiled by Lipper and the Similar Accounts; (4) the costs of services provided to the Funds and the profitability of LKCM; (5) the extent to which economies of scale would be realized by LKCM as a Fund grows and whether the fee levels reflect economies of scale for the benefit of investors; and (6) any other benefits derived by LKCM from its relationship with the Funds. The Board did not identify any single factor or item of information as controlling and each Board member may have accorded different weights to the various factors in reaching his conclusions with respect to the Agreement.

In considering the renewal of the Agreement, the Board requested and considered a broad range of information provided by LKCM, including, but not limited to, reports relating to each Fund’s performance and expenses, information regarding the Similar Accounts, certain portfolio compliance policies and the background and experience of the portfolio managers. In addition, the Board considered a memorandum from its legal counsel regarding the Board’s legal duties in considering the renewal of the Agreement. The Board also meets each quarter to review the Funds’ performance and expenses and various aspects of the Funds’ operations.

Nature, Extent and Quality of Services. The Board reviewed and considered the nature, extent and quality of the advisory services provided by LKCM to each Fund under the Agreement. The Board considered that LKCM has provided investment management services to individuals, foundations, estates, pension plans, endowments, high net worth individuals and other clients since 1979. The Board recognized that LKCM is responsible for managing the Funds and monitoring their performance. The Board considered LKCM’s financial resources, insurance coverage, culture of compliance and compliance operations that support the Funds. The Board also considered LKCM’s representation that it has invested considerable resources into the firm and its personnel to augment investment management and client service. The Board reviewed information regarding the portfolio managers and other key personnel who provide services to each Fund, and considered LKCM’s representation that the firm historically has experienced very low personnel turnover. The Board also considered LKCM’s representation that the firm has implemented a compensation structure designed to attract and retain highly qualified investment professionals.

The Board also reviewed the compliance services provided to the Funds by LKCM, including LKCM’s oversight of the Funds’ day-to-day operations. The Trustees focused on the quality of LKCM’s compliance and support staff. In addition, the Board considered LKCM’s summary of its oversight over the Funds’ key service providers. The Board also considered LKCM’s description of its best execution practices, and noted LKCM’s representation that its soft-dollar and commission sharing arrangements for client transactions (including those for the Funds) comply with the safe harbor provided by Section 28(e) of the Securities Exchange Act of 1934, as amended.

Performance of the LKCM Funds. The Board considered the performance of each Fund compared to the Fund’s benchmark index (“Benchmark”) and a peer group of funds compiled by Lipper (“Lipper Index”) for various time periods ended December 31, 2017. The Board also considered LKCM’s discussion of each Fund’s performance.

The Board noted LKCM’s representation that its investment strategy for the Funds focuses on investments in higher quality companies that meet LKCM’s stringent investment criteria, which had encountered difficulty in overcoming a “reach for yield” and focus on lower quality companies that LKCM believes have driven the market in prior years, and considered that these factors had adversely affected the performance of the Small Cap Equity Fund, Small-Mid Cap Equity Fund and Equity Fund during the longer-term periods ended December 31, 2017. In addition, the Board considered the additional factors cited by LKCM as contributing to or detracting from a Fund’s performance during the prior year.

The Board considered the performance of the Institutional Class of the Small Cap Equity Fund because the Institutional Class has been in existence for the longest period of time and has the longest performance history and largest amount of assets. The Board noted that the Institutional Class of the Small Cap Equity Fund outperformed its Benchmark, the Russell 2000 Index, and its Lipper Index for the one-year and since-inception periods, but underperformed its Benchmark and Lipper Index for the three-year, five-year and ten-year periods.

The Board noted that the Small-Mid Cap Equity Fund outperformed its Benchmark, the Russell 2500 Index, and its Lipper Index for the one-year period, but underperformed its Benchmark and Lipper Index for the three-year, five-year and since-inception periods.

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The Board noted that the Equity Fund underperformed its Benchmark for the one-year, three-year, five-year, ten-year and since-inception periods. The Board also noted that the Equity Fund outperformed its Lipper Index for the one-year, ten-year and since-inception periods, but underperformed its Lipper Index for the three-year and five-year periods.

The Board noted that the Balanced Fund had outperformed the Bloomberg Barclays Intermediate Government/Credit Bond Index for the one-year, three-year, five-year, ten-year and since-inception periods. The Board also noted that the Balanced Fund underperformed the S&P 500 Index for the one-year, three-year, five-year, ten-year and since-inception periods. The Board also compared the Balanced Fund’s performance to a custom blended index that reflected the Fund’s historical allocation to equity and fixed income securities (“Blended Index”). The Board noted that the Balanced Fund outperformed the Blended Index for the ten-year and since-inception periods, but underperformed the Blended Index for the one-year, three-year and five-year periods. The Board also noted that the Balanced Fund outperformed the Lipper Index for the three-year, five-year, ten-year and since-inception periods, but underperformed the Lipper Index for the one-year period.

The Board noted that the Fixed Income Fund outperformed its Benchmark, the Bloomberg Barclays Intermediate Government/Credit Bond Index, for the one-year, three-year and ten-year periods, but underperformed its Benchmark for the five-year and since-inception periods. The Board also noted that the Fixed Income Fund outperformed its Lipper Index for the three-year, five-year, ten-year and since-inception periods, but underperformed the Lipper Index for the one-year period.

The Board also considered the performance of each Fund, as applicable, against its Composite and LKCM’s representations regarding the differences between each such Fund and its Composite, including differences in how the Funds and Similar Accounts are managed, tax considerations, cash flows and shareholder purchase and redemption activities.

Fees and Expenses. The Board considered each Fund’s contractual advisory fee rate, effective advisory fee rate (the contractual advisory fee rate net of fee waivers and/or expense reimbursements) and net expense ratio (the total expense ratio after fee waivers and/or expense reimbursements). The Board also considered that LKCM had contractually agreed to continue the current fee waivers and expense caps in effect for each Fund through May 1, 2019.

The Board compared the contractual advisory fee rate, effective advisory fee rate and the net expense ratio of each Fund to a category of similar funds compiled by Lipper (“Lipper Category”). The Board received information comparing each Fund’s contractual advisory fee rate, effective advisory fee rate and net expense ratio to a Lipper Category reflecting the expenses of the funds in the Lipper Category identified as comparable, and another comparing each Fund’s expenses to the expenses of the institutional class shares of the funds in the Lipper Category. The Board noted, in this regard, LKCM’s representation that, unlike the institutional class shares of many of their peer group funds, the Funds’ Institutional Class shares are generally available for investment by retail investors. Accordingly, the Lipper Category discussed below for each Fund reflects the Lipper Category reflecting all funds in the Lipper Category identified as comparable to the Fund. The first quartile in a Lipper Category represents those funds with the lowest fees or expenses.

The Board generally considered that, although the Funds’ contractual advisory fee rates may be higher than those of their peers, the expense cap arrangements generally cause the Funds’ effective advisory fee rates and overall net expense ratios to be lower than, or in line with, those of their peers.

The Board considered the fees and expenses of the Institutional Class of the Small Cap Equity Fund because the Institutional Class has been in existence for the longest period of time and has the longest performance history and largest amount of assets. The Board noted that the contractual advisory fee rate and effective advisory fee rate for the Small Cap Equity Fund were in the second and first quartiles of its Lipper Category, respectively. The Board also considered that the Small Cap Equity Fund’s net expense ratio was in the second quartile of its Lipper Category. In this case, the Small Cap Equity Fund’s contractual advisory fee rate, effective advisory fee rate and net expense ratio were lower than the average of its Lipper Category.

The Board noted that the contractual advisory fee rate and effective advisory fee rate for the Small-Mid Cap Equity Fund were in the second and first quartiles of its Lipper Category, respectively. The Board also considered that the Small-Mid Cap Equity Fund’s net expense ratio was in the first quartile of its Lipper Category. In this case, the Small-Mid Cap Equity Fund’s contractual advisory fee rate, effective advisory fee rate and net expense ratio were lower than the average of its Lipper Category.

The Board noted that the contractual advisory fee rate and effective advisory fee rate for the Equity Fund were in the third and second quartiles of its Lipper Category, respectively. The Board also considered that the Equity Fund’s net expense ratio was in the second quartile of its Lipper Category. In this case, the Equity Fund’s contractual advisory fee rate was higher than the average of its Lipper Category and the effective advisory fee rate and net expense ratio were lower than the average of its Lipper Category.

The Board noted that the contractual advisory fee rate and effective advisory fee rate for the Balanced Fund were in the third and second quartiles of its Lipper Category, respectively. The Board also considered that the Balanced Fund’s net expense ratio was in the second quartile of its Lipper Category. In this case, the Balanced Fund’s contractual advisory fee rate and effective advisory fee rate were higher than the average of its Lipper Category, and the net expense ratio was lower than the average of its Lipper Category.

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The Board noted that the contractual advisory fee rate and effective advisory fee rate for the Fixed Income Fund were in the fourth and first quartiles of its Lipper Category, respectively. The Board also considered that the Fixed Income Fund’s net expense ratio was in the second quartile of its Lipper Category. In this case, the Fixed Income Fund’s contractual advisory fee rate was higher than the average of its Lipper Category and the effective advisory fee rate and net expense ratio were lower than the average of its Lipper Category.

The Board also considered the advisory fee rates generally charged by LKCM to Similar Accounts and noted LKCM’s explanation that the fee rates charged by LKCM to the Funds and its Similar Accounts differ primarily as a result of differences in the regulatory, compliance and related expenses and level of services between the Funds and the other Similar Accounts.

Costs, Profitability and Economies of Scale. The Board considered LKCM’s costs in rendering services to the Funds and the profitability of LKCM. The Board reviewed the fees paid by each Fund to LKCM for the last three calendar years. The Board also reviewed the estimated profit and loss statement provided by LKCM on a Fund-by-Fund basis for the past calendar year, before and after any distribution-related payments made by LKCM. The Board noted that, during the year, LKCM had invested significant resources to cap the Funds’ net expense ratios and to facilitate the distribution of the Funds. With respect to economies of scale, the Board considered that the Funds generally benefit from competitive effective advisory fee rates and net expense ratios despite not having reached an asset size at which economies of scale traditionally would be considered to exist. The Board also considered that, while there are no breakpoints in the Funds’ advisory fee rate schedules, LKCM waives fees and/or reimburses expenses to maintain the Funds’ effective advisory fee rates and net expense ratios at competitive levels.

Benefits Derived by LKCM from its Relationship with the Funds. The Board requested and considered information regarding the potential fall-out benefits to LKCM from its association with the Funds. The Board noted that LKCM believes that both LKCM and the Funds benefit from LKCM’s soft-dollar and commission sharing arrangements for third party and proprietary research used by LKCM in connection with its investment process. The Board also noted that LKCM believes its relationship with the Funds provides an indirect benefit to both parties in the form of enhanced recognition among institutional investors, consultants and other members of the financial community. The Board considered the indirect benefits to LKCM, in the form of additional clients with separately managed portfolios or subadvisory relationships with other mutual funds, which also may attract additional investors to the Funds.

Conclusion. Based on its evaluation of these and other factors, the Board: (1) concluded that the fees paid to LKCM under the Agreement are fair and reasonable; (2) determined that shareholders would benefit from LKCM’s continued management of the Funds; and (3) approved the renewal of the Agreement with respect to the Funds.

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LKCM FUNDS

PRIVACY NOTICE

Our Commitment to Your Privacy

At LKCM Funds, we are committed to safeguarding the confidentiality and privacy of nonpublic personal information about our current and former shareholders. This privacy notice describes the types of nonpublic personal information we collect about you and the sources through which we obtain this information, the purposes for which we obtain and use your nonpublic information, and the policies and procedures we have implemented to protect the privacy of your nonpublic personal information.

How We Protect Your Nonpublic Personal Information

Protecting your nonpublic personal information is an important priority at LKCM Funds. Accordingly, we have implemented policies and procedures designed to safeguard your nonpublic personal information, such as your tax identification number, account and investment history, account numbers, account balances and nonpublic contact information, from unauthorized access. Pursuant to these policies and procedures, we maintain various physical, technological, and administrative safeguards to protect the security and confidentiality of your nonpublic personal information, and we adapt these safeguards to respond to evolving technological and other standards.

We do not disclose nonpublic personal information about you to outside firms, organizations or individuals except as authorized by you or your representatives or as required or permitted by law. We may disclose nonpublic personal information about you to nonaffiliated third parties, such as custodians, brokers, auditors, accountants, and systems and administrative service providers, in connection with the services we provide to you or on your behalf. When we provide nonpublic personal information about you to nonaffiliated third parties for these purposes, we expect them to safeguard your nonpublic personal information, use your nonpublic personal information only for the intended purposes and otherwise abide by applicable law.

How We Obtain Your Nonpublic Personal Information

We collect nonpublic personal information about you from various sources, including documents, new account applications and other information that you or your representatives, custodians, attorneys, accountants or similar parties provide to us, communications that we have with you or your representatives, custodians, attorneys, accountants or similar parties, and documents and other information related to your accounts or investment experience with us.

Please do not hesitate to contact Jacob D. Smith, our Chief Compliance Officer, if you have any questions regarding this privacy notice or the measures we have implemented to protect the privacy of your nonpublic personal information.

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, WI 53201-0701

LKCM FUNDS

P.O. Box 701

Milwaukee, WI 53201-0701

Officers and Trustees
J. Luther King, Jr., CFA, CIC	H. Kirk Downey	Larry J. Lockwood
Trustee, President and Chief Executive Officer	Chairman of the Board	Trustee
Paul W. Greenwell	Richard J. Howell	Richard Lenart
Vice President	Trustee	Secretary & Treasurer
Steven R. Purvis, CFA	Earle A. Shields, Jr.	Jacob D. Smith
Trustee, Vice President	Trustee	Chief Financial Officer
		Chief Compliance Officer
Investment Adviser
Luther King Capital Management Corporation
301 Commerce Street, Suite 1600
Fort Worth, TX 76102
Administrator, Transfer Agent, Dividend Paying Agent & Shareholder Servicing Agent
U.S. Bancorp Fund Services, LLC
P.O. Box 701
Milwaukee, WI 53201-0701
Custodian
U.S. Bank, N.A.
1555 N. River Center Drive, Suite 302
Milwaukee, WI 53212
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
555 E. Wells St., Suite 1400
Milwaukee, WI 53202
Distributor
Quasar Distributors, LLC
777 East Wisconsin Avenue, Floor 6
Milwaukee, WI 53202

LKCM Aquinas Catholic Equity Fund

Semi-Annual Report

June 30, 2018

Dear Fellow Shareholders:

We report the following performance information for the LKCM Aquinas Catholic Equity Fund for indicated periods ended June 30, 2018:

Funds	Inception Date		NAV @ 6/30/18		Net Expense Ratio*, **			Gross Expense Ratio**			Six Month Total Return Ended 6/30/18			One Year Total Return Ended 6/30/18			Five Year Average Annualized Return Ended 6/30/18			10 Year Average Annualized Return Ended 6/30/18			Avg. Annual Total Return Since Incept.***
LKCM Aquinas Catholic Equity Fund(1)		7/11/05	$	17.94		1.00	%		1.43	%		4.36	%		15.97	%		9.84	%		8.33	%		7.64	%
S&P 500® Index(2)												2.65	%		14.37	%		13.42	%		10.17	%		8.68	%

Performance data quoted represents past performance and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 1-800-423-6369. The Fund imposes a 1.00% redemption fee on shares held less than 30 days. If reflected, the fee would reduce performance shown.

* Luther King Capital Management Corporation, the Fund’s investment adviser, has contractually agreed to waive all or a portion of its management fee and/or reimburse expenses of the Fund to maintain an expense ratio of 1.00% per annum through May 1, 2019. This expense limitation excludes interest, taxes, brokerage commissions, indirect fees and expenses relating to investments in other investment companies, including money market funds, and extraordinary expenses. Investment performance reflects fee waivers, if any, in effect during the relevant period. In the absence of such waivers, total return would be reduced. Investment performance is based upon the net expense ratio. LKCM waived management fees and/or reimbursed expenses for the Fund during the six months ended June 30, 2018.

** Expense ratios above are as of May 1, 2018, as reported in the Fund’s current prospectus. Expense ratios reported for other periods in the financial highlights of this report may differ.

*** The assets of the Aquinas Value Fund, Aquinas Growth Fund and Aquinas Small-Cap Fund were acquired by the LKCM Aquinas Value Fund, LKCM Aquinas Growth Fund and LKCM Aquinas Small Cap Fund, respectively, on July 11, 2005. Due to the change in adviser and investment technique, performance is being quoted for the period after the merger. As further described below, the LKCM Aquinas Small Cap Fund and LKCM Aquinas Growth Fund were reorganized into the LKCM Aquinas Value Fund effective upon the close of business on July 29, 2016, after which the LKCM Aquinas Value Fund’s name, investment strategies and expenses changed to those of the LKCM Aquinas Catholic Equity Fund. The performance shown prior to August 1, 2016 is that of the LKCM Aquinas Value Fund.

(1) Effective upon the close of business on July 29, 2016, the LKCM Aquinas Small Cap Fund and the LKCM Aquinas Growth Fund reorganized into the LKCM Aquinas Value Fund (the “Reorganizations”). Immediately after the Reorganizations were completed, the LKCM Aquinas Value Fund changed its name to the LKCM Aquinas Catholic Equity Fund and its investment strategies and expenses, including the expense limitation agreement, changed to the investment strategies and expenses, including the expense limitation agreement, of the LKCM Aquinas Catholic Equity Fund. The Fund’s performance prior to August 1, 2016 reflects the Fund’s prior investment strategies.

(2) The S&P 500^® Index is an unmanaged capitalization-weighted index of 500 selected stocks that is generally considered representative of the performance of large capitalization companies in the U.S. stock market.

Note: The indices defined above are not available for direct investment and the index performance therefore does not include fees, expenses or taxes.

1H2018 Review and Outlook

For much of the past year “synchronized global growth” has been an apt description of the global economy. With an economic growth tailwind, central bankers in the U.S., Europe, and Japan have been keen to withdraw overly-accommodative monetary policy in anticipation of the next economic downturn. More recently, however, economic growth outside the U.S. appears to be decelerating, making the reduction of accommodative monetary policy more of a risk for global growth. The ability of global economic growth to resynchronize appears to be made more uncertain by the presence of rising protectionism related to trade. For the moment, the U.S. increasingly appears to be the primary engine of global economic growth. Following an annualized rate of 2.0% growth in real Gross Domestic Product (GDP) in the first quarter of 2018, GDP grew by annualized rate of 4.1% in the second quarter of 2018.

Increasingly, investor focus appears to have shifted towards emerging market economies, which had benefited significantly in recent years from broad global growth. In recent years, these markets have revived global trade, manufacturing, and commodity prices. Despite more restrictive monetary policy, particularly in the U.S., the value of the U.S. dollar fell last year, aiding emerging market debt denominated in U.S. dollars. Recently, however, we believe the positive backdrop for emerging markets appears to have deteriorated with a rising U.S. dollar, slowing global growth, and greater protectionism.

Domestically, we believe the U.S. economy has yet to feel the full impact of fiscal stimulus. We believe the sustainability of a fiscally-induced economic expansion largely will depend on the prospect for productivity-increasing investments, which would lift the economy’s growth potential. There are specific provisions of the 2017 tax legislation which target accelerated investment by companies, and our outlook for productivity-enhancing capital expenditures remains positive, as we believe this is increasingly important to sustained economic growth. We believe that late cycle stimulative fiscal policy in the form of lower tax rates supports above-trend economic growth, but this stimulus occurs at a time when the economy’s excess capacity appears to have shrunk considerably. This combination could well result in inflationary wage pressure and rising input costs for companies.

The rate of economic growth in the U.S. rose during the second quarter of 2018 in contrast to the softening of the other remaining ten largest global economies during the same period. A similar slowing of global economic growth occurred in 2015 and caused the Federal

2

Reserve to slow its intended pace of monetary tightening. In contrast, the Federal Reserve is unlikely in our view to abandon its current plans which call for two additional interest rate increases of 0.25% each later this year. The economic output gap, or the difference between economic output and potential economic output, has narrowed over the past two years. As a result, we believe the U.S. economy no longer has spare capacity. When taken in tandem with a 48-year low in the unemployment rate of 3.75% in May 2018, it is unlikely in our view that the Federal Reserve will slow its pace of monetary tightening. As a result, we believe the risk of a monetary policy error, or over-tightening in a slowing economy, has risen. We believe this risk is particularly true if economic growth outside the U.S. continues to slow or there is a further escalation of tariffs.

The degree to which the U.S. should be concerned over its existing trade deficit has quickly become a central economic question in our view. One line of reasoning is that the current trade deficit, which is the result of importing more goods than our country exports, has led to less domestic manufacturing and therefore fewer manufacturing jobs. The Trump administration has elected to erect new tariffs or raise the level of existing tariffs in an effort to level the playing field and protect domestic manufacturing. The inherent challenge is that countries impacted by newly enacted U.S. tariffs are naturally inclined to react in kind by altering their trade policies. This process is made more complex since it is difficult to calibrate the impact of trade tariffs, and the economic impact is not linear. This concept is highlighted by the complex web known as the global manufacturing supply chain. China, for example, assembles a great number of goods comprised of components imported from other countries, such as memory chips and digital displays. If Chinese imports were to experience a 10% decline, we believe Taiwan, Malaysia, and South Korea would suffer a markedly larger blow to their domestic economies relative to China.

The Trump administration’s protectionist rhetoric appears to have a three-pronged purpose. First, it was evident early in his presidential campaign that President Trump intended to defend U.S. manufacturing. Second, the administration appears to view the North American Free Trade Agreement (NAFTA) as less favorable to the U.S. than to Mexico or Canada. Finally, it is apparent there are increasing concerns by the administration over the theft of U.S. corporate intellectual property. In our view, the pursuit of trade protectionism on a larger scale would eventually trim domestic economic growth and create detrimental knock-on effects such as lowering business confidence at a time the economy needs further productivity-enhancing capital investment.

We believe the U.S. economy remains on its gradual progression through a typical business cycle, albeit longer than average, as the underpinnings remain solid in our view. However, late-cycle dynamics such as tighter labor markets appear to have begun to push wages higher, allowing the Federal Reserve to remain on the path to tighter monetary policy. The effect is a traditional flattening of the yield curve that has resulted over the past year. Meanwhile, other late-cycle warning flags, such as deteriorating credit conditions reflected by widening credit spreads, are not yet evident in our view. Similarly, we believe pressure from rising wages to date is not compressing corporate profit margins, which is typical of a mature business cycle. In our view, the later stages of the business cycle are usually reflected in the equity market by a narrowing of market leadership, with investors bidding growth stocks higher in pursuit of continued growth as the broad economy begins to cool.

LKCM Aquinas Catholic Equity Fund

During the six months ended June 30, 2018, the LKCM Aquinas Catholic Equity Fund advanced 4.36% against the 2.65% advance for the Fund’s benchmark, the S&P 500^® Index. During the first half of 2018, the Fund benefited from both good stock selection as well as sector allocation decisions relative to the benchmark.

In the first half of 2018, the Fund benefited from being overweight the Consumer Discretionary, Technology and Energy sectors relative to the benchmark, as well as being underweight the Consumer Staples and Telecommunications sectors. However, the Fund was negatively impacted by its overweight in the Financials and Materials sectors relative to the benchmark, both of which underperformed the broader stock market.

Stock selection during the first half of 2018 also contributed positively to the Fund’s performance and was particularly apparent in the Financials and Industrial sectors. While each of these sectors underperformed during the first half of 2018, the positive stock selection in these sectors somewhat offset the overall sector underperformance. Stock selection somewhat detracted from the Fund’s relative performance in both the Consumer Discretionary and Healthcare sectors during the first half of 2018. The Fund’s relative performance is generally most impacted by the Healthcare sector given that the Fund’s Catholic values investment mandate precludes the Fund from investing in a number of companies within this sector.

We anticipate an expanding economy with solid corporate profit growth throughout the remainder of the year and the Fund’s portfolio reflects this expectation. We believe the U.S. consumer appears to be in the best condition in many years with employment at near record levels and wages advancing after many years of stagnant growth. While inflation and interest rates are both expected to rise, particularly given the timing of the recent 2017 tax legislation, we do not believe these factors will have a negative impact on corporate profits as the year progresses. We believe that it is possible however that, similar to the experience thus far in 2018, stock valuations (as measured by Price-Earnings ratios) may continue to come under some pressure, primarily as a result of higher levels of inflation and interest rates.

We believe the major challenges to our outlook are a higher than expected inflation rate or an overly aggressive Federal Reserve raising interest rates faster than is currently anticipated. Expanding trade issues and higher import fees would likely have some

3

negative impact on profits as currently implemented, but we believe the overall impact on economic growth would not be a significant obstacle to achieving our expectations on corporate profit growth at this time. However, any broadening of the tariffs may cause us to reevaluate this view.

J. Luther King, Jr., CFA, CIC

August 6, 2018

The information provided herein represents the opinion of J. Luther King, Jr., CFA, CIC and is not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

Please refer to the Schedule of Investments found on pages 7-8 of the report for more information on Fund holdings. Fund holdings and sector allocations are subject to change and are not recommendations to buy or sell any securities.

Mutual fund investing involves risk. Principal loss is possible. Past performance is not a guarantee of future results. Small and medium capitalization funds typically carry additional risks, since smaller companies generally have a higher risk of failure, and, historically, their stocks have experienced a greater degree of market volatility than stocks on average. These risks are discussed in the Fund’s summary and statutory prospectuses. Since the Fund practices socially responsible investing within the framework provided by the United States Conference of Catholic Bishop’s Socially Responsible Investing Guidelines, the Fund may forego a profitable investment opportunity or sell a security when it may be disadvantageous to do so.

Price/earnings ratio is the market price of a company share divided by the earnings per share of the company.

Must be preceded or accompanied by a prospectus.

Quasar Distributors, LLC, distributor.

4

LKCM Aquinas Catholic Equity Fund Expense Example — June 30, 2018 (Unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including redemption fees; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (1/1/18 - 6/30/18).

ACTUAL EXPENSES

The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. Although the Fund charges no sales load, you will be assessed fees for outgoing wire transfers, returned checks and stop payment orders at prevailing rates charged by U.S. Bancorp Fund Services, LLC, the Fund’s transfer agent. If you request that a redemption be made by wire transfer, currently a $15 fee is charged by the Fund’s transfer agent. You will be charged a redemption fee equal to 1.00% of the net amount of the redemption if you redeem your shares of the Fund within 30 days of purchase, unless otherwise determined by the Fund in its discretion. To the extent the Fund invests in shares of other investment companies as part of its investment strategy, you will indirectly bear your proportionate share of any fees and expenses charged by the underlying funds in which the Fund invests in addition to the expenses of the Fund. Actual expenses of the underlying funds are expected to vary among the various underlying funds. These expenses are not included in the example below. The example below includes management fees, registration fees and other expenses. However, the example below does not include portfolio trading commissions and related expenses and other extraordinary expenses as determined under generally accepted accounting principles.

HYPOTHETICAL EXAMPLES FOR COMPARISON PURPOSES

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactions costs were included, your costs would have been higher.

	LKCM Aquinas Catholic Equity Fund
	Beginning Account Value 1/1/18		Ending Account Value 6/30/18		Expenses Paid During Period* 1/1/18 – 6/30/18
Actual . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	$	1,000.00	$	1,043.60	$	5.07
Hypothetical (5% return before expense) . . . . . .	$	1,000.00	$	1,019.84	$	5.01

* Expenses are equal to the Fund’s annualized net expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 181/365 to reflect the one-half year period.

5

ALLOCATION OF PORTFOLIO HOLDINGS — LKCM Aquinas Catholic Equity Fund — June 30, 2018 (Unaudited)

Percentages represent market value as a percentage of total investments.

LKCM Aquinas Catholic Equity Fund

6

LKCM AQUINAS CATHOLIC EQUITY FUND

SCHEDULEOF INVESTMENTS

June 30, 2018 (Unaudited)

COMMON STOCKS - 99.4%	Shares		Value
Aerospace & Defense - 3.0%
Honeywell International Inc.		12,500	$	1,800,625
Banks - 10.9%
Comerica Incorporated		19,000		1,727,480
Cullen/Frost Bankers, Inc.		8,000		865,920
SunTrust Banks, Inc.		30,400		2,007,008
Zions Bancorporation		37,500		1,975,875
				6,576,283
Beverages - 2.0%
PepsiCo, Inc.		11,000		1,197,570
Chemicals - 4.3%
DowDuPont Inc.		12,500		824,000
Ecolab Inc.		9,500		1,333,135
FMC Corporation		5,000		446,050
				2,603,185
Computers & Peripherals - 3.2%
Apple Inc.		10,500		1,943,655
Construction Materials - 2.4%
Martin Marietta Materials, Inc.		6,500		1,451,645
Diversified Financials - 2.4%
JPMorgan Chase & Co.		14,000		1,458,800
Electrical Equipment & Instruments - 3.0%
Roper Technologies, Inc.		6,500		1,793,415
Electronic Equipment & Instruments - 3.6%
FLIR Systems, Inc.		24,500		1,273,265
Trimble Inc. (a)		27,000		886,680
				2,159,945
Energy Equipment & Services - 2.6%
Halliburton Company		21,500		968,790
Schlumberger Ltd. (b)		8,400		563,052
				1,531,842
Food Products - 1.7%
Mondelez International Inc. - Class A		25,000		1,025,000
Household Durables - 0.7%
Whirlpool Corporation		3,000		438,690
Household Products - 1.1%
Colgate-Palmolive Company		10,000		648,100
Insurance - 2.3%
Prudential Financial, Inc.		15,000		1,402,650
Internet & Catalog Retail - 3.1%
Amazon.com, Inc. (a)		1,100		1,869,780
Internet Software & Services - 7.4%
Akamai Technologies, Inc. (a)		28,200		2,065,086
Alphabet, Inc. - Class A (a)		2,100		2,371,299
Alphabet, Inc. - Class C (a)		0		1
				4,436,386

COMMON STOCKS	Shares		Value
IT Consulting & Services - 3.3%
PayPal Holdings, Inc. (a)		24,000	$	1,998,480
Machinery - 1.7%
Barnes Group Inc.		17,500		1,030,750
Marine - 2.9%
Kirby Corporation (a)		20,500		1,713,800
Multiline Retail - 1.4%
Dollar Tree, Inc. (a)		10,000		850,000
Oil & Gas & Consumable Fuels - 9.0%
Cabot Oil & Gas Corporation		37,500		892,500
ConocoPhillips		17,500		1,218,350
EOG Resources, Inc.		13,000		1,617,590
Occidental Petroleum Corporation		20,000		1,673,600
				5,402,040
Pharmaceuticals - 4.8%
Abbott Laboratories		22,500		1,372,275
Zoetis Inc.		17,500		1,490,825
				2,863,100
Professional Services - 2.0%
Verisk Analytics, Inc. (a)		11,000		1,184,040
Software - 10.4%
Adobe Systems Incorporated (a)		8,500		2,072,385
Microsoft Corporation		13,625		1,343,561
Oracle Corporation		27,500		1,211,650
RealPage, Inc. (a)		30,000		1,653,000
				6,280,596
Specialty Retail - 6.6%
The Home Depot, Inc.		8,000		1,560,800
Party City Holdco Inc. (a)		55,000		838,750
Tiffany & Co.		12,000		1,579,200
				3,978,750
Textiles, Apparel & Luxury Goods - 3.6%
Tapestry, Inc.		22,500		1,050,975
VF Corporation		13,500		1,100,520
				2,151,495
TOTAL COMMON STOCKS
(Cost $35,171,266)				59,790,622

The accompanying notes are an integral part of these financial statements.

7

LKCM AQUINAS CATHOLIC EQUITY FUND

SCHEDULEOF INVESTMENTS, CONTINUED

June 30, 2018 (Unaudited)

SHORT-TERM INVESTMENT - 0.7%	Shares		Value
Money Market Fund - 0.7%
Invesco Short-Term Investments Trust-Government & Agency Portfolio - Institutional Shares, 1.81% (c)		425,438	$	425,438
TOTAL SHORT-TERM INVESTMENT
(Cost $425,438)				425,438
Total Investments - 100.1%
(Cost $35,596,704)				60,216,060
Liabilities in Excess of Other Assets - (0.1)%				(51,361	)
TOTAL NET ASSETS - 100.0%			$	60,164,699

(a) Non-income producing security.

(b) Security issued by non-U.S. incorporated company.

(c) The rate quoted is the annualized seven-day yield of the fund at period end.

Investments are classified by industry pursuant to the Global Industry Classification Standard (GICS^®), which was developed by and/or is the exclusive property of Morgan Stanley Capital International, Inc. (“MSCI”) and Standard & Poor’s Financial Services LLC (“S&P”). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.

The accompanying notes are an integral part of these financial statements.

8

STATEMENTOF ASSETSAND LIABILITIES

June 30, 2018 (Unaudited)

LKCM Aquinas Catholic Equity Fund
Assets:
Investments, at value *	$	60,216,060
Dividends and interest receivable		51,824
Receivable for fund shares sold		48,844
Prepaid trustee fees		4,041
Other assets		23,706
Total assets		60,344,475
Liabilities:
Payable for investment advisory fees		71,090
Payable for distribution expense (Note B)		33,653
Payable for Fund shares redeemed		9,039
Payable for accounting and transfer agent fees and expenses		13,949
Payable for administrative fees		8,455
Payable for custody fees and expenses		1,005
Accrued expenses and other liabilities		42,585
Total liabilities		179,776
Net Assets	$	60,164,699
Net Assets Consist of:
Paid-in capital	$	26,393,029
Undistributed net investment income		108,573
Accumulated net realized gain on securities		9,043,741
Net unrealized appreciation on investments		24,619,356
Net Assets	$	60,164,699
Net Assets	$	60,164,699
Shares of beneficial interest outstanding (unlimited shares of no par value authorized)		3,354,073
Net asset value per share (offering and redemption price)	$	17.94
* Cost of Investments	$	35,596,704

The accompanying notes are an integral part of these financial statements.

9

STATEMENTOF OPERATIONS

For the Six Months Ended June 30, 2018 (Unaudited)

LKCM Aquinas Catholic Equity Fund
Investment Income:
Dividends	$	427,248
Interest		6,072
Total income		433,320
Expenses:
Investment advisory fees		302,710
Accounting and transfer agent fees and expenses		42,556
Distribution expense (Note B)		33,634
Administrative fees		27,902
Reports to shareholders		19,412
Federal and state registration		15,234
Professional fees		14,067
Trustees’ fees		9,262
Custody fees and expenses		3,866
Other		13,147
Total expenses		481,790
Less, expense waiver and/or reimbursement (Note B)		(145,446	)
Net expenses		336,344
Net investment income		96,976
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain on investments		8,998,319
Net change in unrealized appreciation/depreciation on investments		(6,071,173	)
Net Realized and Unrealized Gain on Investments		2,927,146
Net Increase in Net Assets Resulting from Operations	$	3,024,122

The accompanying notes are an integral part of these financial statements.

10

STATEMENTSOF CHANGESIN NET ASSETS

LKCM Aquinas Catholic Equity Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017
Operations:
Net investment income	$	96,976		$	184,302
Net realized gain on investments		8,998,319			5,621,042
Net change in unrealized appreciation/depreciation on investments		(6,071,173	)		6,425,935
Net increase in net assets resulting from operations		3,024,122			12,231,279
Dividends and Distributions to Shareholders:
Net investment income		—			(177,185	)
Net realized gain on investments		—			(5,325,615	)
		—			(5,502,800	)
Net increase (decrease) in net assets resulting from Fund share transactions (Note C)		(13,916,927	)		1,331,772
Total increase (decrease) in net assets		(10,892,805	)		8,060,251
Net Assets:
Beginning of period		71,057,504			62,997,253
End of period*	$	60,164,699		$	71,057,504
* Including accumulated net investment income of	$	108,573		$	11,597

The accompanying notes are an integral part of these financial statements.

11

FINANCIAL HIGHLIGHTS

SELECTED DATAFOR EACH SHAREOF CAPITAL STOCK OUTSTANDING

	LKCM Aquinas Catholic Equity Fund
	Six Months Ended June 30, 2018 (Unaudited)			Year Ended December 31, 2017			Year Ended December 31, 2016 (1)			Year Ended December 31, 2015			Year Ended December 31, 2014			Year Ended December 31, 2013
Net Asset Value – Beginning of Period	$	17.19		$	15.40		$	15.17		$	16.87		$	17.99		$	14.18
Net investment income		0.03			0.05			0.04			0.03			0.17	(2)		0.04	(3)
Net realized and unrealized gain (loss) on investments		0.72			3.16			1.41			(0.56	)		0.34			4.72
Total from investment operations		0.75			3.21			1.45			(0.53	)		0.51			4.76
Dividends from net investment income		—			(0.05	)		(0.04	)		(0.04	)		(0.19	)		(0.04	)
Distributions from net realized gains		—			(1.37	)		(1.18	)		(1.13	)		(1.44	)		(0.91	)
Total dividends and distributions		—			(1.42	)		(1.22	)		(1.17	)		(1.63	)		(0.95	)
Net Asset Value – End of Period	$	17.94		$	17.19		$	15.40		$	15.17		$	16.87		$	17.99
Total Return		4.36%	(4)		20.79%			9.52%			-3.28%			2.73%			33.60%
Ratios and Supplemental Data:
Net assets, end of period (thousands)	$	60,165		$	71,058		$	62,997		$	44,868		$	52,652		$	59,061
Ratio of expenses to average net assets:
Before expense waiver and/or reimbursement		1.43%	(5)		1.43%			1.66%			1.55%			1.49%			1.52%
After expense waiver and/or reimbursement(6)		1.00%	(5)		1.00%			1.23%			1.50%			1.49%			1.50%
Ratio of net investment income to average net assets:
Before expense waiver and/or reimbursement		(0.14)%	(5)		(0.14)%			(0.15)%			0.14%			0.95%			0.21%
After expense waiver and/or reimbursement(6)		0.29%	(5)		0.29%			0.28%			0.19%			0.95%			0.23%
Portfolio turnover rate		10%			18%			18%			11%			23%			9%

⁽¹⁾  Effective upon the close of business on July 29, 2016, the LKCM Aquinas Growth Fund and the LKCM Aquinas Small Cap Fund were reorganized into the LKCM Aquinas Value Fund and the Fund was renamed the LKCM Aquinas Catholic Equity Fund. Activity after July 29, 2016 reflects the Funds’ combined operations.

⁽²⁾  Net investment income per share represents net investment income divided by the average shares outstanding throughout the period.

⁽³⁾  Net investment income per share is calculated using the ending balance of accumulated net investment income prior to considerations of adjustments for permanent book and tax differences.

⁽⁴⁾  Not annualized.

⁽⁵⁾  Annualized.

⁽⁶⁾  Effective August 1, 2016, the Fund’s investment adviser contractually agreed to lower the expense cap for the Fund from 1.50% to 1.00% of the Fund’s average daily net assets and the fees charged under the Fund’s Rule 12b-1 plan changed from 0.25% per annum to 0.10% per annum as of August 1, 2016.

The accompanying notes are an integral part of these financial statements.

12

LKCM FUNDS

NOTESTOTHE FINANCIAL STATEMENTS (Unaudited)

A.    Organization and Significant Accounting Policies:    LKCM Funds (the “Trust”) is registered under the Investment Company Act of 1940 (“1940 Act”) as an open-end, management investment company. The Trust was organized as a Delaware statutory trust on February 10, 1994 and consists of six diversified series, one of which is presented herein: the LKCM Aquinas Catholic Equity Fund (the “Fund”). On July 11, 2005, the LKCM Aquinas Funds acquired the assets and assumed the liabilities of the Aquinas Funds. Effective upon the close of business on July 29, 2016, the LKCM Aquinas Small Cap Fund and the LKCM Aquinas Growth Fund reorganized into the LKCM Aquinas Value Fund, which changed its name immediately thereafter to the LKCM Aquinas Catholic Equity Fund and its investment strategies and expenses, including the expense limitation agreement, changed to the investment strategies and expenses, including the expense limitation agreement, of the LKCM Aquinas Catholic Equity Fund. The Fund is subject to expenses pursuant to the Rule 12b-1 plan described in Note B. The Fund charges a 1% redemption fee for redemptions of Fund shares held for less than 30 days, unless otherwise determined by the Fund in its discretion.

The LKCM Aquinas Catholic Equity Fund seeks to maximize long-term capital appreciation, while incorporating Catholic values investing principles in the investment process. The LKCM Aquinas Catholic Equity Fund seeks to achieve its investment objective by investing under normal circumstances at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of companies that Luther King Capital Management Corporation (the “Adviser”) believes are likely to have above-average growth in revenue and/or earnings, above-average returns on shareholders’ equity, potential for above-average capital appreciation, and/or companies the Adviser believes have attractive relative valuations.

The Fund practices socially responsible investing within the framework provided by the United States Conference of Catholic Bishops’ Socially Responsible Investing Guidelines (the “Guidelines”). The Fund’s investment approach incorporates the Guidelines through a combination of screening portfolio companies based on criteria set forth in the Guidelines, dialogue with companies whose policies and practices may conflict with the Guidelines, and/or potentially excluding from the Fund’s portfolio the securities of those companies that are unwilling to alter their policies and practices over a reasonable period of time. The Adviser monitors companies selected for the Fund for policies on various issues contemplated by the Guidelines. If the Fund invests in a company whose policies and practices are inconsistent with the Guidelines, the Adviser may attempt to influence the company, sell the company’s securities or otherwise exclude future investments in such company.

The following is a summary of significant accounting policies followed by the Fund in preparation of the financial statements. The Fund is an investment company and, accordingly, follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standards Codification Topic 946, Investment Companies.

1.    Security Valuation:    Equity securities listed or traded on a U.S. securities exchange for which market quotations are readily available are valued at the last quoted sale price on the exchange on which the security is primarily traded. Nasdaq Global Market securities are valued at the Nasdaq Official Closing Price (“NOCP”). Unlisted U.S. securities and listed U.S. securities not traded on a particular valuation date are valued at the mean of the most recent quoted bid and ask price on the relevant exchanges or markets. Equity securities listed on a foreign exchange for which market quotations are readily available are valued at the last quoted sales price on the exchange on which the security is primarily traded. Debt securities are normally valued at the mean of the closing bid and ask price and/or by using a combination of broker quotations or evaluated prices provided by an independent pricing service. Other assets and securities for which no market or broker quotations or evaluated prices are readily available (including restricted securities) are valued in good faith at fair value using guidelines approved by the Board of Trustees. The Board has adopted specific guidelines and procedures for valuing portfolio securities and delegated their implementation to the Adviser. The guidelines and procedures authorize the Adviser to make determinations regarding the fair value of a portfolio security and to report such determinations to the Board of Trustees. The Fund may use prices provided by independent pricing services to assist in the fair valuation of the Fund’s portfolio securities.

The Trust has adopted accounting standards which establish an authoritative definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion of changes in valuation techniques and related inputs during the period. These standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy is organized into three levels based upon the assumptions (referred to as “inputs”) used in pricing the asset or liability. These standards state that “observable inputs” reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from independent sources and “unobservable inputs” reflect an entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability. These inputs are summarized in the three broad levels listed below.

Level 1 – Quoted unadjusted prices for identical instruments in active markets to which the Trust has access at the date of measurement.

13

Level 2	–	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, little public information exists or instances where prices vary substantially over time or among brokered market makers.
Level 3	–	Model derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Trust’s own assumptions that market participants would use to price the asset or liability based on the best available information.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. As of June 30, 2018, the Fund’s assets carried at fair value were classified as follows:

LKCM Aquinas Catholic Equity Fund
Description	Level 1		Level 2		Level 3		Total
Common Stocks	$	59,790,622	$	—	$	—	$	59,790,622
Money Market Fund		425,438		—		—		425,438
Total Investments*	$	60,216,060	$	—	$	—	$	60,216,060

* Additional information regarding the industry classifications of these investments is disclosed in the Schedule of Investments.

There were no transfers into or out of Level 1, Level 2 or Level 3 fair value measurements during the reporting period. Transfers between levels are recognized at the end of the reporting period.

2.    Federal Income Taxes:    The Fund has elected to be treated as a “regulated investment company” under Subchapter M of the Internal Revenue Code and the Fund intends to distribute all of its investment company net taxable income and net capital gains to shareholders. Therefore, no federal income tax provision is recorded.

3.    Distributions to Shareholders:    The Fund generally intends to pay dividends and distribute net capital gain distributions, if any, at least on an annual basis.

4.    Foreign Securities:    Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in securities of U.S. issuers. These risks include devaluation of currencies and future adverse political and economic developments. Moreover, securities of many foreign companies and foreign governments and their markets may be less liquid and their prices more volatile than those of securities of comparable U.S. companies and securities of the U.S. government.

5.    Expense Allocation:    Expenses incurred by the Funds in the Trust are allocated among the Funds based upon (i) relative average net assets, (ii) a specific identification basis as incurred, or (iii) evenly among the Funds, depending on the nature of the expense.

6.    Use of Estimates:    The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

7.    Guarantees and Indemnifications:    In the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims against the Fund that have not yet occurred. Based on experience, the Fund expects the risk of loss to be remote.

8.    Security Transactions and Investment Income:    Security and shareholder transactions are recorded on the trade date. Realized gains and losses on sales of investments are calculated on the identified cost basis. Dividend income and dividends and distributions to shareholders are recorded on the ex-dividend date. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable jurisdiction’s tax rules and rates. Interest income is recognized on the accrual basis. All discounts and premiums are amortized based on the effective interest method for tax and financial reporting purposes. The Fund may hold the securities of real estate investment trusts (“REITs”). Distributions from such investments may include income, capital gains and return of capital.

9.    Other:    Generally accepted accounting principles require that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share.

14

10.    Restricted and Illiquid Securities:    The Fund is permitted to invest in securities that are subject to legal or contractual restrictions on resale including investments considered by the Fund to be illiquid. Restricted securities generally may be resold in transactions exempt from registration. Illiquid investments are investments that cannot be sold or disposed of within seven days in the ordinary course of business at approximately the prices at which they are valued. A security may be considered illiquid if it lacks a readily available market or if its valuation has not changed for a certain period of time. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at the current valuation may be difficult.

B.    Investment Advisory and Other Agreements:    The Adviser serves as the investment adviser to the Fund under an Investment Advisory Agreement (the “Agreement”). The Adviser receives a fee, computed daily and payable quarterly, at the annual rate presented below as applied to the Fund’s average daily net assets. The Adviser has contractually agreed to waive all or a portion of its management fee and/or reimburse expenses of the Fund through May 1, 2019 in order to limit the Fund’s operating expenses to the annual cap rate identified below. This expense limitation excludes interest, taxes, brokerage commissions, indirect fees and expenses relating to investments in other investment companies, including money market funds, and extraordinary expenses. For the six months ended June 30, 2018, the Adviser waived the following management fees and/or reimbursed expenses to meet its expense cap obligations for the Fund:

Annual Management Fee Rate		0.90%
Annual Cap on Expenses		1.00%
Fees Waived and/or Expenses Reimbursed in 2018	$	145,446

U.S. Bancorp Fund Services, LLC serves as transfer agent and administrator for the Fund and serves as accounting services agent for the Fund. U.S. Bank, N.A. serves as custodian for the Fund.

Distribution services are performed pursuant to a distribution contract with Quasar Distributors, LLC, the Trust’s principal underwriter.

The Trust has adopted a Rule 12b-1 plan for the LKCM Aquinas Catholic Equity Fund, under which the Fund may pay up to 1.00% of its average daily net assets for distribution and other services. However, the Board of Trustees has currently only authorized an annual fee of 0.10% of the average daily net assets for the Fund. Prior to August 1, 2016, the Fund assessed an annual Rule 12b-1 fee of 0.25% of the average daily net assets for the Fund. For the six months ended June 30, 2018, fees incurred by the Fund pursuant to the 12b-1 Plan were $33,634.

C.    Fund Shares:    At June 30, 2018, there was an unlimited number of shares of beneficial interest, no par value, authorized. The following table summarizes the activity in shares of the Fund:

	Six Months Ended June 30, 2018						Year Ended December 31, 2017
	Shares			Amount			Shares			Amount
Shares sold		209,628		$	3,700,619			574,803		$	10,003,218
Shares issued to shareholders in reinvestment of distributions		—			—			300,904			5,193,603
Shares redeemed		(990,224	)		(17,618,867	)		(830,500	)		(13,865,336	)
Redemption fee					1,321						287
Net decrease		(780,596	)	$	(13,916,927	)		45,207		$	1,331,772
Shares Outstanding:
Beginning of period		4,134,669						4,089,462
End of period		3,354,073						4,134,669

D.    Security Transactions:    Purchases and sales of investment securities, other than short-term investments, for the Fund for the six months ended June 30, 2018 were as follows:

Purchases				Sales
U.S. Government		Other		U.S. Government		Other
$	—	$	6,589,312	$	—	$	19,984,390

15

E.    Tax Information:    At December 31, 2017, the components of accumulated earnings (losses) on a tax basis for the Fund were as follows:

Cost of Investments	$	41,218,647
Gross Unrealized Appreciation	$	31,044,333
Gross Unrealized Depreciation		(353,804	)
Net Unrealized Appreciation	$	30,690,529
Undistributed Ordinary Income		11,597
Undistributed Long-Term Capital Gain		45,422
Total Distributable Earnings	$	57,019
Total Accumulated Gains	$	30,747,548

The difference between book-basis and tax-basis unrealized appreciation, if any, is attributable primarily to the tax deferral of losses on wash sales.

To the extent the Fund realizes future net capital gains, taxable distributions will be reduced by any unused capital loss carryforwards as permitted by the Internal Revenue Code. The Fund currently has no capital loss carryforwards.

The tax components of dividends paid during the periods shown below for the Fund were as follows:

Six Months Ended June 30, 2018				Year Ended December 31, 2017
Ordinary Income		Long-Term Capital Gains		Ordinary Income		Long-Term Capital Gains
$	—	$	—	$	177,185	$	5,325,615

The Fund designated as long-term capital gain dividend, pursuant to Internal Revenue Code Section 852(b)(3), the amount necessary to reduce earnings and profits of the Fund related to net capital gain to zero for the tax years ended December 31, 2017 and 2016. The Fund designated earnings and profits distributed to shareholders upon the redemption of shares during 2017 and 2016 in determining undistributed net capital gains as of December 31, 2017 and 2016.

The Trust has adopted financial reporting rules regarding recognition and measurement of tax positions taken or expected to be taken on a tax return. The Trust has reviewed all open tax years and major jurisdictions and concluded that there is no impact on the Fund’s financial position or results of operations. Tax years that remain open to examination by major tax jurisdictions include tax years ended December 31, 2014 through December 31, 2017. There is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken on tax returns as of December 31, 2017. The Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. If applicable, the Fund would recognize interest accrued related to unrecognized tax benefits in “interest expense” and penalties in “other expense” on the statement of operations.

F.    Subsequent Events:    In preparing these financial statements, the Trust has evaluated events after June 30, 2018 and determined that there were no significant subsequent events that would require adjustment to or additional disclosure in these financial statements.

16

LKCM AQUINAS CATHOLIC EQUITY FUND

ADDITIONAL INFORMATION

June 30, 2018 (Unaudited)

Availability of Proxy Voting Information:    A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to its portfolio securities, as well as information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, is available without charge, upon request, by calling toll-free 1-800-423-6369 or on the SEC website at http://www.sec.gov.

The actual voting records relating to portfolio securities during the twelve month period ended June 30 (as filed with the SEC on Form N-PX) are available without charge, upon request, by calling the Fund toll free at 1-800-423-6369 or by accessing the SEC’s website at www.sec.gov.

Availability of Quarterly Portfolio Schedule:    The Fund is required to file complete schedules of portfolio holdings with the SEC for the first and third fiscal quarters on Form N-Q. Once filed, the Fund’s Form N-Q is available without charge upon request on the SEC’s website (http://www.sec.gov) and is also available by calling 1-800-423-6369. You can also review and copy the Fund’s Form N-Q by visiting the SEC’s Public Reference Room in Washington, DC (information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330).

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RENEWAL OF INVESTMENT ADVISORY AGREEMENT

WITH RESPECT TO LKCM AQUINAS CATHOLIC EQUITY FUND

Introduction. At a meeting held on February 27, 2018, the Board of Trustees of LKCM Funds, including the independent Trustees (the “Board”), approved the renewal of the Investment Advisory Agreement (the “Agreement”) between Luther King Capital Management Corporation (“LKCM”) and LKCM Funds (the “Trust”) on behalf of the LKCM Aquinas Catholic Equity Fund (the “Fund”).

In voting to approve the renewal of the Agreement, the Board considered information furnished throughout the year at regularly scheduled Board meetings, as well as information prepared specifically in connection with the annual renewal process. The Board also considered the overall fairness of the Agreement and factors it deemed relevant with respect to the Fund including, but not limited to: (1) the nature, extent and quality of the services provided to the Fund; (2) the performance of the Fund as compared to a relevant benchmark, peer group of funds compiled by Lipper, Inc. (“Lipper”) and a composite (“Composite”) of accounts managed by LKCM pursuant to a similar investment strategy (“Similar Accounts”); (3) the level of the fees and the overall expenses of the Fund and how those compared to a peer group of funds compiled by Lipper and the Similar Accounts; (4) the costs of services provided to the Fund and the profitability of LKCM; (5) the extent to which economies of scale would be realized by LKCM as the Fund grows and whether the fee levels reflect economies of scale for the benefit of investors; and (6) any other benefits derived by LKCM from its relationship with the Fund. The Board did not identify any single factor or item of information as controlling and each Board member may have accorded different weights to the various factors in reaching his conclusions with respect to the Agreement.

In considering the renewal of the Agreement, the Board requested and considered a broad range of information provided by LKCM, including but not limited to, reports relating to the Fund’s Catholic-values investing mandate, the Fund’s performance and expenses, information regarding the Similar Accounts, certain portfolio compliance policies and the background and experience of the portfolio managers. In addition, the Board considered a memorandum from its legal counsel regarding the Board’s legal duties in considering the renewal of the Agreement. The Board also meets each quarter to review the Fund’s performance and expenses and various aspects of the Fund’s operations.

Nature, Extent and Quality of Services. The Board reviewed and considered the nature, extent and quality of the advisory services provided by LKCM to the Fund under the Agreement. The Board considered that LKCM has provided investment management services to individuals, foundations, estates, pension plans, endowments, high net worth individuals and other clients since 1979. The Board recognized that LKCM is responsible for managing the Fund and monitoring its performance. The Board considered LKCM’s financial resources, insurance coverage, culture of compliance and compliance operations that support the Fund. The Board also considered LKCM’s representation that it has invested considerable resources into the firm and its personnel to augment investment management and client service. The Board reviewed information regarding the portfolio managers and other key personnel who provide services to the Fund, and considered LKCM’s representation that the firm historically has experienced very low personnel turnover. The Board also considered LKCM’s representation that the firm has implemented a compensation structure designed to attract and retain highly qualified investment professionals.

The Board also reviewed the compliance services provided to the Fund by LKCM, including LKCM’s oversight of the Fund’s day-to-day operations. The Trustees focused on the quality of LKCM’s compliance and support staff. In addition, the Board considered LKCM’s summary of its oversight over the Fund’s key service providers. The Board also considered LKCM’s description of its best execution practices, and noted LKCM’s representation that its soft-dollar and commission sharing arrangements for client transactions (including those for the Fund) comply with the safe harbor provided by Section 28(e) of the Securities Exchange Act of 1934, as amended.

Performance of the Fund. The Board considered the performance of the Fund compared to the Fund’s benchmark index, the S&P 500 Index (“Benchmark”), and a peer group of funds compiled by Lipper (“Lipper Index”) for various time periods. The Board noted that, upon the closing of the reorganizations of the LKCM Aquinas Small Cap Fund and LKCM Aquinas Growth Fund into the Fund (the “Reorganization”), the Fund’s name, investment strategies, expenses, benchmark index and Lipper index changed and considered this in reviewing the Fund’s longer-term performance against its current Benchmark and Lipper Index. The Board also considered LKCM’s discussion of the Fund’s performance.

The Board noted that the Fund underperformed its current Benchmark and Lipper Index for the one-year, three-year, five-year, ten-year and since-inception periods.

In considering the comparative performance data, the Board noted that the Fund is managed in accordance with its Catholic-values investing guidelines, which restrict the Fund’s investments and generally are not applicable to the Benchmark or funds included in the Lipper Index. The Board noted LKCM’s representation that its investment strategy for the Fund focuses on investments in higher quality companies that meet LKCM’s stringent investment criteria, which had encountered difficulty in overcoming a “reach for yield” and focus on lower quality companies that LKCM believes have driven the market in prior years, and that the Fund pursued a value investing strategy prior to the Reorganization, which had underperformed growth investing strategies during certain of the periods. The Board also considered additional factors cited by LKCM as contributing to or detracting from the Fund’s performance during the past year.

The Board also considered the performance of the Fund against the Composite and LKCM’s representations regarding the differences between the Fund and the Composite, including differences in how the Fund and the Similar Accounts are managed, tax considerations, cash flows and shareholder purchase and redemption activities.

18

Fees and Expenses. The Board considered the contractual advisory fee rate, effective advisory fee rate (the contractual advisory fee rate net of fee waivers and/or expense reimbursements) and net expense ratio (the total expense ratio after fee waivers and/or expense reimbursements) of the Fund. The Board also considered that LKCM had contractually agreed to continue the current fee waivers and expense caps in effect for the Fund through May 1, 2019.

The Board compared the contractual advisory fee rate, effective advisory fee rate and the net expense ratio of the Fund to a category of similar funds compiled by Lipper (“Lipper Category”). The Board received information comparing the Fund’s contractual advisory fee rate, effective advisory fee rate and net expense ratio to a Lipper Category reflecting the expenses of the funds in the Lipper Category identified as comparable, and another comparing the Fund’s expenses to the expenses of the institutional class shares of the funds in the Lipper Category. The Board noted, in this regard, LKCM’s representation that, unlike the institutional class shares of many of their peer group funds, the Fund’s shares are available for investment by retail investors. Accordingly, the Lipper Category discussed below for the Fund reflects the Lipper Category reflecting all funds in the Lipper Category identified as comparable to the Fund. The first quartile in a Lipper Category represents those funds with the lowest fees or expenses.

The Board noted that the contractual advisory fee rate and effective advisory fee rate for the Fund were in the fourth and second quartiles of its Lipper Category, respectively. The Board also noted that the Fund’s net expense ratio was in the second quartile of its Lipper Category. In this case, the Fund’s contractual advisory fee rate was higher than the average of its Lipper Category and its effective advisory fee rate and net expense ratio were lower than the average of its Lipper Category.

The Board also considered the advisory fee rates generally charged by LKCM to Similar Accounts and noted LKCM’s explanation that the fee rates charged by LKCM to the Fund and the Similar Accounts differ primarily as a result of differences in the regulatory, compliance and related expenses and level of services between the Fund and the Similar Accounts.

Costs, Profitability and Economies of Scale. The Board considered LKCM’s costs in rendering services to the Fund and the profitability of LKCM. The Board reviewed the fees paid by the Fund to LKCM for the last three calendar years. The Board also reviewed the estimated profit and loss statement provided by LKCM for the past calendar year, before and after any distribution-related payments made by LKCM. The Board noted that, during the year, LKCM had invested significant resources to cap the Fund’s net expense ratio and facilitate the distribution of the Fund. With respect to economies of scale, the Board considered that the Fund generally benefits from a competitive effective advisory fee rate and net expense ratio despite not having reached an asset size at which economies of scale traditionally would be considered to exist. The Board also considered that, while there are no breakpoints in the Fund’s advisory fee rate schedule, LKCM waives fees and/or reimburses expenses to maintain the Fund’s net expense ratio at competitive levels.

Benefits Derived by LKCM from its Relationship with the Fund. The Board requested and considered information regarding the potential fall-out benefits to LKCM from its association with the Fund. The Board noted that LKCM believes that both LKCM and the Fund benefit from LKCM’s soft-dollar and commission sharing arrangements for third party and proprietary research used by LKCM in connection with its investment process. The Board also noted that LKCM believes its relationship with the Fund provides an indirect benefit to both parties in the form of enhanced recognition among institutional investors, consultants and other members of the financial community. The Board considered the indirect benefits to LKCM, in the form of additional clients with separately managed portfolios or subadvisory relationships with other mutual funds, which also may attract additional investors to the Fund.

Conclusion. Based on its evaluation of these and other factors, the Board: (1) concluded that the fees paid to LKCM under the Agreement are fair and reasonable; (2) determined that shareholders would benefit from LKCM’s continued management of the Fund; and (3) approved the renewal of the Agreement.

19

LKCM FUNDS

PRIVACY NOTICE

Our Commitment to Your Privacy

At LKCM Funds, we are committed to safeguarding the confidentiality and privacy of nonpublic personal information about our current and former shareholders. This privacy notice describes the types of nonpublic personal information we collect about you and the sources through which we obtain this information, the purposes for which we obtain and use your nonpublic information, and the policies and procedures we have implemented to protect the privacy of your nonpublic personal information.

How We Protect Your Nonpublic Personal Information

Protecting your nonpublic personal information is an important priority at LKCM Funds. Accordingly, we have implemented policies and procedures designed to safeguard your nonpublic personal information, such as your tax identification number, account and investment history, account numbers, account balances and nonpublic contact information, from unauthorized access. Pursuant to these policies and procedures, we maintain various physical, technological, and administrative safeguards to protect the security and confidentiality of your nonpublic personal information, and we adapt these safeguards to respond to evolving technological and other standards.

We do not disclose nonpublic personal information about you to outside firms, organizations or individuals except as authorized by you or your representatives or as required or permitted by law. We may disclose nonpublic personal information about you to nonaffiliated third parties, such as custodians, brokers, auditors, accountants, and systems and administrative service providers, in connection with the services we provide to you or on your behalf. When we provide nonpublic personal information about you to nonaffiliated third parties for these purposes, we expect them to safeguard your nonpublic personal information, use your nonpublic personal information only for the intended purposes and otherwise abide by applicable law.

How We Obtain Your Nonpublic Personal Information

We collect nonpublic personal information about you from various sources, including documents, new account applications and other information that you or your representatives, custodians, attorneys, accountants or similar parties provide to us, communications that we have with you or your representatives, custodians, attorneys, accountants or similar parties, and documents and other information related to your accounts or investment experience with us.

Please do not hesitate to contact Jacob D. Smith, our Chief Compliance Officer, if you have any questions regarding this privacy notice or the measures we have implemented to protect the privacy of your nonpublic personal information.

U.S. Bancorp Fund Services, LLC

P.O. Box 701

Milwaukee, WI 53201-0701

LKCM FUNDS

P.O. Box 701

Milwaukee, WI 53201-0701

Officers and Trustees
J. Luther King, Jr., CFA, CIC	H. Kirk Downey	Larry J. Lockwood
Trustee, President and Chief Executive Officer	Chairman of the Board	Trustee
Paul W. Greenwell	Richard J. Howell	Richard Lenart
Vice President	Trustee	Secretary & Treasurer
Steven R. Purvis, CFA	Earle A. Shields, Jr.	Jacob D. Smith
Trustee, Vice President	Trustee	Chief Financial Officer
		Chief Compliance Officer
Investment Adviser
Luther King Capital Management Corporation
301 Commerce Street, Suite 1600
Fort Worth, TX 76102
Administrator, Transfer Agent, Dividend Paying Agent & Shareholder Servicing Agent
U.S. Bancorp Fund Services, LLC
P.O. Box 701
Milwaukee, WI 53201-0701
Custodian
U.S. Bank, N.A.
1555 N. River Center Drive, Suite 302
Milwaukee, WI 53212
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
555 E. Wells St., Suite 1400
Milwaukee, WI 53202
Distributor
Quasar Distributors, LLC
777 East Wisconsin Avenue, Floor 6
Milwaukee, WI 53202

Item 2. Code of Ethics.

Not applicable for semi-annual reports.

Item 3. Audit Committee Financial Expert.

Not applicable for semi-annual reports.

Item 4. Principal Accountant Fees and Services.

Not applicable for semi-annual reports.

Item 5. Audit Committee of Listed Registrants.

Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).

Item 6. Schedule of Investments.

(a) Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.

(b) Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable to open-end investment companies.

Item 10. Submission of Matters to a Vote of Security Holders.

There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of trustees.

Item 11. Controls and Procedures.

(a) The registrant’s Chief Executive Officer and Chief Financial Officer have reviewed the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) as of a date within 90 days of the filing of this report, as required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed in this report is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the registrant in reports that it files or submits on Form N-CSR is accumulated and communicated to the registrant’s management, including its principal executive and financial officers, as appropriate to allow timely decisions regarding required disclosure.

(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Not applicable to open-end investment companies.

Item 13. Exhibits.

(a) (1) Any code of ethics or amendment thereto, that is subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Not applicable.

(2) A separate certification for each principal executive and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.

(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies.

(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant)   LKCM Funds

By (Signature and Title)	/s/ J. Luther King, Jr.
	J. Luther King, Jr., President

Date   8-31-2018

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title)	/s/ J. Luther King, Jr.
	J. Luther King, Jr., President

Date   8-31-2018

By (Signature and Title)	/s/ Jacob D. Smith
	Jacob D. Smith, Chief Financial Officer

Date 8-31-2018

.