Form N-CSR World Funds Trust For: Dec 31

LDR Real Estate Value-Opportunity Fund

ANNUAL REPORT

For the Year Ended December 31, 2023

The LDR Real Estate Value-Opportunity Fund’s (the “Fund”) prospectus contains important information about the Fund’s investment objectives, potential risks, management fees, charges and expenses, and other information and should be read and considered carefully before investing. To obtain the Fund’s prospectus containing this and other important information, please call 800-673-0550. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC is the distributor and LDR Capital Management, LLC is the investment advisor.

The performance data quoted represents past performance and is not guarantee of future results. Current performance of the Fund may be lower or higher than the performance data quoted. Investment returns and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Information provided with respect to the Fund’s Performance Data, Portfolio Holdings, Sector Weightings, Number of Holdings and Expense Ratios are as of December 31, 2023 and are subject to change at any time. For most recent information, please call 800-673-0550.

The Advisor waived or reimbursed part of the Fund’s total expenses. Had the Advisor not waived or reimbursed expenses of the Fund, the Fund’s return would have been lower.

Dear LDR Real Estate Value-Opportunity Investor:

After posting negative returns through the first nine months of 2023, Public Real Estate share prices responded to the sharp downward shift in interest rates during the fourth quarter resulting in a 16.0% gain in the MSCI US REIT Index for Q4, 2023 leading all S&P 500 sectors. For the year Public Real Estate recorded a positive 13.74% return (MSCI US REIT Index) as well as positive returns (+11.8% to +12.4%) for REIT ETFs such as Vanguard REIT- VNQ and Real Estate Select Sector- XLRE respectively. While this did not match the broader stock market returns for 2023 (S&P 500 +26%), it represents a solid outcome in a year where commercial real estate media reports were consistently negative and private commercial real estate values declined.

The Real Estate Asset Class returns often do not correlate closely with the broader stock market and have much higher interest rate sensitivity. Public Real estate pricing reflects these characteristics but usually leads the private real estate market in repricing asset values. This has been clearly evident as the significant upward move in interest rates over the past two years culminating with a 5% Ten Year Treasury rate (5.25% discount rate) in October 2023 resulted in a decline of -22% for public real estate values over the period. The magnitude of this change in interest rates disrupted credit markets resulting in a significant decline in commercial real estate transaction activity, as well as limited private market real estate price discovery.

LDR Capital Management fund results are net of expenses and fees and reflect the reinvestment of dividends and capital gains. Index returns are reported before expenses and fees and also reflect the reinvestment of dividends and capital gains. Class I gross expense ratio of 1.72%. The performance data quoted represents past performance and is no guarantee of future results. 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 their original cost. Current performance may be lower or higher than the performance data quoted. For the most recent month-end performance, please call 800-527-9525.

See Page 7 for additional information and footnotes.

In late October 2023, a downward shift in both interest rates and positive sentiment resulted in an upward move in public real estate share pricing over the last two months of the fourth quarter. While commercial real estate economics remain healthy, private real estate markets are still undergoing the process of price discovery which may not be completed until later in 2024.

Source: Bloomberg as of 12/31/2023

MAVG: Moving Average; SMAVG (50): 50-day Simple Moving Average; SMAVG (200): 200-day Simple Moving Average

Source: Green Street Advisors, Inc. as of Jan 5, 2024.	Source: Bloomberg as of 12/31/2023
Private Market Real Estate Pricing Continues to Decline on Limited Transaction Activity.	The positive change in interest rates may indicate more favorable capital markets for Commercial Real Estate

Over the next 12-18 months stabilization of interest rates and the credit markets could allow for the emergence of private debt and equity capital to engage in the price discovery process for commercial real estate refinancing and equity transactions. The public market real estate platforms with access to liquidity and capital are also likely to participate in new opportunities for real estate value creation.

The Real Estate Value-Opportunity Fund participated in the positive public real estate market price returns in Q4, 2023. However, as is often the case the Fund lags outsized price moves in both directions (examples Q3, 2023 the Fund value declined -3.3% vs MSCI US REIT Index -7.0%). These shorter-term variances are typically due to the Value-Opportunity Fund’s more concentrated portfolio (16 core equity holdings), a tilt toward smaller capitalizations, cash from asset recycling and REIT preferred holdings resulting in portfolio positioning well outside the parameters of REIT indexes. For the full year 2023, Fund returns of +10.48% reached the targeted long-term annualized returns for the Real Estate Value-Opportunity Fund.

Fourth Quarter 2023 returns for individual equity positions were largely influenced by interest rate sensitivity, market capitalization and previous period relative performance. Among the better performing real estate equity exposure (+18%) was the XLRE - Real Estate Select ETF a concentrated large capitalization real estate ETF (20% of the portfolio equity positioning). This ETF is targeted when public real estate has experienced significant negative returns to provide exposure to the largest market capitalization components of the public real estate sector.

Two of the higher return equity positions relate to interest rate sensitive single-family housing. A single smaller office platform also benefitted from the prospect of lower interest rates which in turn improves refinancing and price discovery for this difficult property sector. Urban Edge is an urban (northeast corridor) shopping center platform which achieved significant occupancy gains from unusually strong leasing demand.

LDR Real Estate Value-Opportunity Fund
(Holds 16 Common Equity Investments)

Source: Bloomberg, LDR Capital Management

*Returns are price-only. For informational purposes only, the specific investments shown represent only the top contributors and detractors for the relevant performance time period. The selection criteria used to determine the top contributors and detractors remains the same across performance measurement periods.

There were only two real estate equity positions with negative returns in Q4, 2023. One multi-family potential M&A situation was already approaching fair value and did not participate in the Q4 public real estate share price recovery. The worst performer was Kennedy Wilson Holdings, a skilled and seasoned real estate developer and asset manager who appropriately wrote down asset values across its multi-billion dollar commercial real estate partnerships and fund platforms. These properties continue to perform well and the company is positioned to take advantage of acquisition and refinancing opportunities that should unfold in 2024.

The performance data quoted represents past performance and is no guarantee of future results. 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 their original cost. Current performance may be lower or higher than the performance data quoted.

The Real Estate Value-Opportunity Fund will continue to primarily focus capital on real estate equity positioning where real estate value, cash flow and importantly the capabilities of the real estate platform (management, capital, business plan) to create value are viewed favorably relative to opportunities that may arise in 2024. The Fund also remains structured well outside the parameters of the REIT Indexes/ ETFs with limited focus on relative sector positions or market capitalization.

The capital allocation to housing remains important targeting special situations related to single family for-sale housing and rental communities, multi-family properties and multi-family refinancing. These real estate platforms have the experience and liquidity to capture market share over the period ahead.

Top Common Equity Holdings

The healthcare positions are core holdings which continue to offer an undervalued real estate capital allocation with visible cash flow and a view toward longer-term total returns. The shopping center real estate holdings which have experienced strong tenant demand offer attractive potential longer-term total return while delivering solid cash flow growth even in a slowing economic environment. Selected REIT preferred provide an opportunity to increase cash flow while continuing to offer repricing upside.

Source: LDR Real Estate Value Opportunity Portfolio Data at 12/31/23.

REIT Quartiles reflect market capitalization segments.

REOCS: Real Estate Operating Companies

Public market real estate pricing is now solidly above October 2023 levels reflecting the prospect that interest rates may no longer present a headwind to real estate value and price discovery. The better than earlier anticipated positive returns for the Real Estate value-opportunity Fund in a difficult commercial real estate environment is encouraging. As is usually the case, forecasting is not a particularly productive endeavor, but the backdrop today appears much brighter than last October.

As always, thank you for your continued interest and support and best wishes for a safe, healthy and prosperous New Year.

Sincerely,

	​
Edward W. Turville, CFA Portfolio Manager	​	Larry Raiman Managing Principal

Footnotes and Other Important Disclosures

This newsletter is a publication of LDR Capital Management. The letter contains certain forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties which may cause actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by these forward-looking statements or projections. The letter should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change.

Certain information contained herein has been obtained from published and non-published sources prepared by other parties. While such information is believed to be reliable for the purpose used herein, no representations or warranties are given as to the reliability, accuracy, or completeness of the information.

Information presented does not involve the rendering of personalized investment advice but is limited to the dissemination of general information on products and services. Information presented is not an offer to buy or sell, or a solicitation of any offer to buy or sell the securities mentioned herein.

Indices

Bloomberg Barclays US Aggregate Bond Index: A broad-based benchmark that measures the investment grade, US dollar-denominated, fixed- rate taxable bond market. The index includes Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and non-agency).

S&P 500^® Index: (registered trademark of The McGraw-Hill Companies, Inc.) is an unmanaged index of 500 common stocks primarily traded on the New York Stock Exchange, weighted by market capitalization. Index performance includes the reinvestment of dividends and capital gains.

The MSCI US REIT Index is a free float-adjusted market capitalization weighted index that is comprised of equity REITs.

The Russell 2000 Index is comprised of the smallest 2000 companies in the Russell 3000 Index.

Green Street’s Commercial Property Price Index® is a time series of unleveraged U.S. commercial property values that captures the prices at which commercial real estate transactions are currently being negotiated and contracted.

It is not possible to invest directly in an index.

Mutual Fund investing involves risk. Principal loss is possible.

REIT Risk. REITs are pooled investment vehicles which include equity REITs and mortgage REITs. The fund is subject to risks similar to those associated with the direct ownership of real estate, including changing economic conditions, declining real estate values, and liquidity and interest rate risk.

Leverage Risk. The Fund may use leverage in executing its investment strategy. Leverage will increase the volatility of the Fund’s performance and its risk. There can be no assurance that a leveraging strategy will be successful.

Short Sales Risk. The Fund may engage in short sales of securities and index funds in executing its investment strategy. Such practices can, in certain circumstances, substantially increase the impact of adverse price movements on the Fund’s portfolio. Short sales may involve substantial risk and leverage.

Investors should consider the investment objectives, risks, charges, and expenses carefully before investing. Investments must be proceeded or accompanied by a prospectus. For a prospectus with this and other information about the fund, please call 800-527-9525 or visit the Fund’s website at www.ldrfunds.com. Please read the prospectus carefully before investing.

Fund holdings and sector allocations are subject to change at any time and should not be considered a recommendation to buy or sell any security. Please see the Schedule of Investments in this report for a complete list of fund holdings.

Distributed by Foreside Fund Services, LLC.

LDR Real Estate Value-Opportunity Fund

*The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares

The MSCI US REIT Index is a free float-adjusted market capitalization weighted index that is comprised of equity Real Estate Investment Trusts (REITs). The index is based on the MSCI USA Investable Market Index (IMI), its parent index, which captures the large, mid and small cap segments of the USA market. With 151 constituents, it represents about 99% of the US REIT universe and securities are classified under the Equity REITs Industry (under the Real Estate Sector) according to the Global Industry Classification Standard (GICS®), have core real estate exposure (i.e., only selected Specialized REITs are eligible) and carry REIT tax status.

(The comparative index is not adjusted to reflect expenses that the Securities and Exchange Commission requires to be reflected in the Fund’s performance.)

Common Stocks

Preferred Stocks

^(A)Non-income producing

^(B)Effective 7 day yield as of December 31, 2023

⁽¹⁾Per share amounts calculated using the average number of shares outstanding throughout the year.

⁽²⁾Gross expense ratio reflects the effect of interest, dividend and proxy expenses which are excluded from the Fund’s expense limitation agreement.

⁽³⁾Ratio of total expenses before management fee waivers and reimbursements, excluding proxy costs, dividend and interest expenses, would have been 2.15% 1.74%, 1.58%, 1.55% and 1.35% for the years ended December 31, 2023 through December 31, 2019, respectively.

⁽⁴⁾Ratio of total expenses net of management fee waivers and reimbursements, excluding proxy costs, dividend and interest expenses, would have been 1.00%, 1.00%, 1.00%. 1.00% and 1.09% for the years ended December 31, 2023 through December 31, 2019, respectively.

⁽¹⁾Per share amounts calculated using the average number of shares outstanding throughout the year.

⁽²⁾Gross expense ratio reflects the effect of interest, dividend and proxy expenses which are excluded from the Fund’s expense limitation agreement.

⁽³⁾Ratio of total expenses before management fee waivers and reimbursements, excluding proxy costs, dividend and interest expenses, would have been 2.56%, 2.17%, 2.02%, 2.01% and 1.78% for the years ended December 31, 2023 through December 31, 2019, respectively.

⁽⁴⁾Ratio of total expenses net of management fee waivers and reimbursements, excluding proxy costs, dividend and interest expenses, would have been 1.25%, 1.25%, 1.25%, 1.25% and 1.33% for the years ended December 31, 2023 through December 31, 2019, respectively.

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES

The LDR Real Estate Value-Opportunity Fund (the “Fund”) is a diversified series of the World Funds Trust (the “Trust”) which was organized as a Delaware statutory trust on April 9, 2007 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management company. LDR Capital Management, LLC (“LDR”) is the investment advisor to the Fund. The Fund was established in December, 2002 originally as a series of Hillview Investment Trust II. Effective November 23, 2005, the Fund was reorganized as a series of The World Funds, Inc. (“TWF”). On August 15, 2014, the Fund was reorganized from TWF into the Trust. The Fund maintains its financial statements, information, and performance history in accordance with the reorganizations. Prior to March 26, 2022, the Fund was known as REMS Real Estate Value-Opportunity Fund.

The Fund currently offers Institutional, Platform and Z Shares. At December 31, 2023, there were no Z Shares outstanding for the Fund.

The investment objectives of the Fund is to achieve long-term capital growth and current income through a portfolio of publicly traded real estate securities that may include equity REITs, mortgage REITs, REIT preferred and other publicly traded companies whose primary business is in the real estate industry.

The Fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 “Financial Services – Investment Companies”. The following is a summary of significant accounting policies consistently followed by the Fund. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

Security Valuation

The Fund’s securities are valued at current market prices. Investments in securities traded on the national securities exchanges are valued at the last reported sale price. Investments in securities included in the NASDAQ National Market System are valued at the NASDAQ Official Closing Price. Other securities traded in the over-the-counter market and listed securities for which no sales are reported on a given date are valued at the last reported bid price. Short-term debt securities (less than 60 days to maturity) are valued at their fair market value using amortized cost. Other assets for which market prices are not readily available are valued at their fair value as determined in good faith under procedures set by the Board of Trustees of the Trust (the “Board”). Although the

Board is ultimately responsible for fair value determinations under Rule 2a-5 of the 1940 Act, the Board has delegated day-to-day responsibility for oversight of the valuation of the Fund’s assets to LDR as the Valuation Designee pursuant to the Fund’s policies and procedures. Generally, trading in corporate bonds, U.S. government securities and money market instruments is substantially completed each day at various times before the scheduled close of the New York Stock Exchange. The value of these securities used in computing the NAV is determined as of such times.

The Fund has a policy that contemplates the use of fair value pricing to determine the NAV per share of the Fund when market prices are unavailable for a portfolio security as well as under special circumstances, such as: (i) if the primary market for a portfolio security suspends or limits trading or price movements of the security; and (ii) when an event occurs after the close of the exchange on which a portfolio security is principally traded that is likely to have changed the value of the security. It is anticipated that the use of fair value pricing will be limited.

When the Fund uses fair value pricing to determine the NAV per share of the Fund, securities will not be priced on the basis of quotations from the primary market in which they are traded, but rather may be priced by another method that the Valuation Designee believes accurately reflects fair value. Any method used will be approved by the Board and results will be monitored to evaluate accuracy. The Fund’s policy is intended to result in a calculation of the Fund’s NAV that fairly reflects security values as of the time of pricing.

The Fund has adopted fair valuation accounting standards that 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 used to develop the measurements of fair value. These inputs are summarized in the three broad levels listed below.

Various inputs are used in determining the value of the Fund’s investments. GAAP established a three-tier hierarchy of inputs to establish a classification of fair value measurements for disclosure purposes. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Level 3 includes significant unobservable inputs (including the Fund’s own assumptions in determining fair value of investments).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the level of inputs used to value the Fund’s investments as of December 31, 2023:

Refer to the Fund’s Schedule of Investments for a listing of the securities by type and sector.

The Fund held no Level 3 securities during the year ended December 31, 2023.

Security Transactions and Income

Security transactions are accounted for on the trade date. The cost of securities sold is determined generally on a specific identification basis. Realized gains and losses from security transactions are determined on the basis of identified cost for book and tax purposes. Dividend income is recorded on the ex-dividend date. Interest income is recorded on an accrual basis.

The Fund uses a major financial institution as its prime broker to process securities transactions and to provide custodial and other services. Any cash balances include amounts of “restricted cash” consisting of proceeds from securities sold, not yet purchased. Cash balances maintained in the custody of the prime broker bear interest based on the prime rate. The Fund also borrows on margin for security purchases.

Securities are held as collateral by the prime broker against margin obligations. The clearance agreements permit the prime broker to pledge or otherwise hypothecate the Fund’s investment securities subject to certain limitations. The prime broker may also sell such securities in limited instances where required collateral is not posted in a timely manner. These arrangements subject the Fund to concentration of credit risk with respect to the prime broker.

Accounting Estimates

In preparing financial statements in conformity with GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Federal Income Taxes

The Fund has complied and intends to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to its shareholders. The Fund also intends to distribute sufficient net investment income and net capital gains, if any, so that it will not be subject to excise tax on undistributed income and gains. Therefore, no federal income tax or excise provision is required.

Management has reviewed the tax positions taken for the Fund for each of the open tax years (2020-2022) and expected to be taken in the 2023 tax returns, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken in the Fund’s tax returns. The Fund has no examinations in progress and management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change.

Reclassification of Capital Accounts

GAAP requires that certain components of net assets be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. For the year ended December 31, 2023, there were no such reclassifications.

Class Net Asset Values and Expenses

All income, expenses not attributable to a particular class, and realized and unrealized gains or losses on investments, are allocated to each class based upon its relative net assets on a daily basis for purposes of determining the net asset value of each class. Certain shareholder servicing and distribution fees are allocated to the particular class to which they are attributable.

Real Estate Investment Trust Securities

The Fund has made certain investments in real estate investment trusts (“REITs”) which make distributions to their shareholders based upon available funds from operations. Each REIT reports annually the tax character of its distribution. Dividend income, capital gain distributions received, and unrealized appreciation (depreciation) reflect the amounts of taxable income, capital gain and return of capital reported by the REITs. It is common for these distributions to exceed the REIT’s taxable earnings and profits resulting in the excess portion of such distributions being designated as a return of capital. The Fund intends to include the gross dividends from such REITs in the periodic distributions to the shareholders and, accordingly, a portion of the Fund’s distributions may also be designated as a return of capital. A domestic REIT is generally not taxed on income distributed to shareholders so long as it meets certain tax related requirements, including the requirement that it distribute substantially all of its taxable income to its shareholders. Foreign REITs and REIT-like entities that are organized outside of the U.S. and have operations may receive tax treatment similar to that of U.S. REITs in their respective countries. Management does not estimate the tax character of REIT distributions for which actual information has not been reported.

NOTE 2 – INVESTMENT ADVISORY AND DISTRIBUTION AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES

Pursuant to an Investment Advisory Agreement, the Fund’s investment advisor, LDR, provides investment advisory services for an annual fee of 0.90% of the daily net assets of the Fund.

LDR earned and waived advisory fees, and reimbursed expenses, for the year ended December 31, 2023 as follows:

LDR has contractually agreed to waive its fees and reimburse expenses so that the annual fund operating expenses for the Fund do not exceed 1.00% of the average daily net assets of the Fund, until April 30, 2024. This limit does not apply to distribution fees pursuant to Rule 12b-1 Plans, brokerage commissions, taxes, interest, dividend expenses on short sales, acquired fund fees and expenses, other expenditures capitalized in accordance with GAAP or other extraordinary expenses not incurred in the ordinary course of business. The expense limitation agreement may only be terminated by the Board and LDR prior to April 30, 2024

by mutual written consent. Each waiver and/or reimbursement of an expense by LDR is subject to repayment by the Fund within the three years following the date such waiver and/or reimbursement was made, provided that the Fund is able to make the repayment without exceeding the expense limitation in place at the time of the waiver or reimbursement is recouped.

The total amount of recoverable reimbursements as of December 31, 2023 and expiration dates are as follows:

The Board has adopted a Distribution Plan for the Fund’s Platform Shares (the “12b-1 Plan”). Pursuant to the 12b-1 Plan, the Fund may pay from the assets of the Platform Shares certain activities or expenses that are intended primarily to result in the sale of shares of such class. The fee paid by the Fund is computed on an annualized basis reflecting the average daily net assets of the class, up to a maximum of 0.25% for expenses of the Platform Shares. With respect to Platform Shares, 0.25% represents 12b-1 distribution fees paid to institutions that have agreements with the Distributor to provide such services. Because these fees are paid out of the Platform Shares’ assets on an ongoing basis, over time these fees will increase the cost of your investment and may cost more than paying other types of sales charges. The 12b-1 Plan, while primarily intended to compensate for shareholder services expenses, was adopted pursuant to Rule 12b-1 under the 1940 Act, and therefore may be used to pay for certain expenditures related to financing distribution related activities of the Fund.

The Fund has adopted a shareholder services plan with respect to its Institutional and Platform Shares. Under the shareholder services plan, the Fund may pay an authorized firm up to 0.25% on an annualized basis of average daily net assets attributable to its customers who are shareholders. For this fee, the authorized firms may provide a variety of services, including but not limited to: (i) arranging for bank wires; (ii) responding to inquiries from shareholders concerning their investment in the Fund; (iii) assisting shareholders in changing dividend options, account designations and addresses; (iv) providing information periodically to shareholders showing their position in Fund shares; (v) forwarding shareholder communications from the Fund such as proxies, shareholder reports, annual reports, and dividend distribution and tax notices to shareholders; (vi) processing purchase, exchange and redemption requests from shareholders and placing orders with the Fund or their service providers; (vii) providing sub-accounting with respect to Fund Shares beneficially owned by shareholders; and (viii) processing dividend payments from the Fund on behalf of shareholders.

For the year ended December 31, 2023, the following expenses were incurred: