Latest results for the year to June 30 2018 show construction margins up from 2.8% last time.
The European division – which is dominated by the UK – saw pre-tax profits rise to £19m from £13m on revenue down to £387m from £670m.
Lendlease said staff numbers have not dropped significantly despite the decrease in turnover.
Neil Martin, Managing Director, Lendlease Construction, Europe, said: “In 2014 we devised a strategy of being highly selective about the projects we were bidding for, targeting key sectors and markets where Lendlease is able to differentiate its offering to clients, focusing on quality and a client-led service.
“This year’s results demonstrate precisely the positive outcome of adopting this strategy.
“Our focus on profitability rather than revenue has led to further growth in gross profit for Lendlease’s Construction business.
“Our recent focus to manage risk exposure across the portfolio means that a significant amount of our workload is now Construction Management.
“Achieving this balance between fee and risk work has been key to this year’s positive results.
“So, whilst revenue is down, the profit margin is up and this positions us strongly as we continue to deliver on the expanding pipeline.”