Leeds United unveiled record losses for an English club this morning at just under £50 million (€72 million), but chairman John McKenzie is confident he can turn the club's fortunes around.
McKenzie said he had taken steps to restructure the finances at the Elland Road club which, under the leadership of former chairman Peter Ridsdale, whom he replaced in March, had invested heavily in a failed bid for European glory.
But McKenzie warned that any potential turnaround in the health of Leeds depended "not only on a prudent, effective business operation, but also upon our football team performing satisfactorily within the premier league."
Currently second from bottom in the Premiership, the club that three years ago reached the semi-finals of the lucrative Champions League announced pre-tax losses of £49.5 million pounds in the year to June 30th, from £33.8 million the previous year.
With turnover down by a fifth to £64 million, player wages accounted for 88 perc ent of that.
McKenzie said he had cut costs by £20 million after a number of highly paid senior managers were made redundant, the size of the staff was reduced and the club offloaded several key players.
"As such it is now possible to begin to look forward with some confidence," he said.
McKenzie appointed Trevor Birch, replaced at Chelsea this year following Roman Abramovich's takeover, as chief executive to oversee the day-to-day running of the business.
"His appointment will enable me to concentrate on the long-term strategic development and the restructuring and refinancing of the business," said McKenzie.
Leeds' financial meltdown ought to send a chilling warning to the rest of their Premiership rivals, according to the Professional Footballers' Association.
The PFA believe Leeds' announcement has proved that virtually no club is safe in today's depressed financial climate.
And they insisted that even in the comfort zone of the top-flight, clubs have nowhere to hide from simple mismanagement.
The PFA's deputy chief executive Mick McGuire has been instrumental in helping to smooth the financial problems of more than 40 clubs over the last year. And he says there are clear signs that the same problems which afflicted relegated clubs are now taking hold in places where the drop had not even appeared to be an option.
McGuire said: "There is no doubt that this has sounded a major warning bell that even in the Premier League it is essential to manage your finances appropriately.
"When you looked deeply into the way the club was being run you expected problems at Leeds. Now it is crucial that Leeds stay in the Premiership. if Leeds go down, I fear for them."