Steel Authority of India Limited (SAIL) has announced that its net profit during the first quarter dropped 11.55% at Rs 1,176.65 crore as compared to Rs 1,330.43 crore in the same period of 2009-10.

The quarterly results of the state-run steel producing giant failed to meet market estimations.

The company's profitableness was affected by a range of factors, which comprise sharp input cost escalations, lower volume of sales and lethargic market situations.

The steel behemoth recorded a decline of 1.89% in its total income, which stood at Rs 9,519.52 crore as against Rs 9,703.51 crore in the same period of 2009-10.

In the meantime, SAIL's gross sales grew by 1.83% at 9930.78 as against Rs 9751.62 crore during the first quarter of last financial year.

The income from other business activities of the company earned it Rs. 12.04 crore, which is a 82.70 percent growth from Rs. 6.59 crore in the corresponding period of 2009-10.

SAIL Chairman C. S. Verma said, "Greater availability of steel worldwide coupled with pressure on demand made the market conditions quite testing for steel companies in the first quarter. With signs of stability in prices and demand picking up in the country, we are optimistic about the ensuing quarters." (With Inputs from Agencies)