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Technology giant Samsung Electronics has posted second quarter profits of 1.42 trillion won (£0.87 billion), down 11 per cent from the year's first quarter after demand for its mobile phones and flat screen TVs fell.

But the South Korean company has attributed the slight dip to seasonally-adjusted factors and believes that a new wave of desirable products will see its profits rise by the end of the year.

The firm's vice president, Chu Woo-Sik, explained that intense competition between rival companies had forced prices downwards as the market became saturated.

"During the second quarter, many companies in the same industry faced difficulties due to declining prices in mainstay products," he said.

"However, it's noteworthy that operating profit exceeded market expectations amid a challenging market environment in the previous quarter, a result of our competitiveness and focus on innovation. We expect the second quarter to mark the trough and anticipate improvements in the second half of this year," he added.

Samsung shares fell 4.3 per cent during the last quarter, compared to an industry average of 4.7 per cent.

The company's telecoms and mobile business revenue was 4.28 trillion won (£2.4 billion) for the past three months, while its operating profits were ten per cent down, as despite growth in the 3G marketplace, Samsung faced intense competition from other mobile firms to produce the market-leading mobile handset, a position currently held by Motorola's slim line Razr model.

Samsung's LCD operating profits fell by a similar margin to its mobile output, even taking into account the effect of the World Cup, which led to an 87 per cent increase in giant 40-inch TV screen sales.

Samsung is the world's largest technology company outside of the US, and such is its dominance in its native South Korea that workers jokingly refer to their country as the Republic of Samsung.