South Korea's Samsung Electronics has announced a 17% rise in profits in the last three months of 2011, as smartphone sales boosted earnings.

Net profit for the quarter was 4 trillion won ($3.6bn; £2.3bn), up from 3.42tn won in the same period the previous year, Samsung said.

However, for the whole of 2011 net income was down 15% compared with 2010.

Samsung's parent group is planning $42bn (£26.8bn) in capital investment this year.

'Solid earnings'

Samsung said that its Galaxy line of mobile devices drove up revenue for the year by almost 40% compared with the previous year.

Despite tough competition from the likes of Apple in the smartphone market, Samsung said that shipments of it smartphones rose by about 30% in the fourth quarter on an annual basis.

"Our telecommunications business continued to post solid earnings with an enhanced line-up of high-end smartphones, resulting in [a] higher average selling price," said Robert Yi, senior vice president and head of investor relations, in the earnings statement.

Looking ahead to this year, Samsung is forecasting increased demand for entry-level smartphones and tablet PCs, as well as consistent demand for feature phones.

Panel problems

The company said it will spend 25tn won in capital expenditure this year on its chip and panel businesses, according to the statement.

However, that panel display business, which makes flat panels for TVs and computer monitors, did not perform as well in 2011.

Samsung said it had an operating loss of 220bn won, compared with an operating profit of 100bn won a year earlier.

Despite that Samsung announced its latest line of TVs, which are controlled by voice commands and hand gestures, at the Consumer Electronics Show in Las Vegas last month.

Source :bbc.co.uk