Seoul - South Korea's Samsung Electronics Friday reported a 51-per-cent profit increase for the second quarter of 2008, as sales were boosted by booming mobile phone and flat screen TV business, but stayed below analysts' expectations.

Profits in the months from April to June climbed by 50.6 per cent to 2.14 trillion won (2.11 billion dollars) year-on-year. Profits stayed almost level compared with the previous quarter.

Operating profits rose to 1.89 trillion won from 911 billion year-on-year, but again remained below analysts' predictions. First quarter operating profits were 2.19 trillion won.

Sales increased by 24 per cent to 18.1 billion won. Mobile phone sales increased by 22 per cent to 45.7 million units compared with the second quarter of 2007. LCD TV sales were up by 41 per cent to 4.71 billion won, while profits from memory chips dropped by 18 per cent.

Samsung achieved solid results, despite a global economic downturn, lagging demand in key markets, an increase in raw material prices and higher marketing costs, the company said.

"The second quarter has been extremely challenging due to stagnant demand and price drops in the memory market, along with growing price competition in the mobile and LCD TV markets," South Korea's leading electronics company said.

Samsung is the world's largest producer of computer memory chips and flat screen TVs and as mobile phone maker comes second only after market leader Nokia.

Samsung shares dropped more than 6.19 per cent Friday as profits turned out lower than analysts' expectations. The outlook for 2009 is also less than sunny, with the global slowdown expected to impact on consumer electronics sales. (dpa)