Lotte Engineering & Construction reported a second straight quarter of earnings recovery, posting consolidated second-quarter operating profit of 122.4 billion won ($88 million) on revenue of 1.68 trillion won. While revenue fell 14.1% from a year earlier, operating profit rose 230% from 37.1 billion won and the operating margin improved 1.9 percentage points to 7.3%, reflecting the company's strategy of selective bidding focused on profitability rather than top-line expansion. The improvement was also visible in costs and balance-sheet metrics. The cost ratio fell to 88.8% in the second quarter from 93.6% a year earlier, continuing a quarterly decline from 92.8% at the end of last year and 91.7% in the first quarter. For the first half, revenue totaled 3.28 trillion won and operating profit reached 172.8 billion won, up 131.9 billion won, or 323%, from 40.9 billion won a year earlier, driven by urban redevelopment and development projects and a greater share of high-margin sites. Selling and administrative expenses declined to 148.5 billion won in the first half from 165.3 billion won a year earlier. Financial stability also improved, with the debt-to-equity ratio falling to 162.8% in the second quarter from 186.7% at the end of last year, while total equity rose to 3.62 trillion won and cash and cash equivalents increased to 820.9 billion won. The company also reduced project financing contingent liabilities to 2.43 trillion won as large sites were converted into main project financing, and said it aims to bring that figure down to about 2.2 trillion won by year-end.