Premier League return forced to wait as Blades get house in order

The Blades' annual accounts yesterday did not make for pleasant reading given they had made a 6m profit 12 months earlier.

But Birch insists the South Yorkshire outfit is in comparatively good shape given the plight of many of their troubled rivals and they have taken pre-emptive action to ensure they do not disintegrate in a similar fashion.

He feels some Championship clubs will "definitely go to the wall" due to on-going financial pressures but in its annual report United revealed, because of the magnitude of that economic downturn, it has made significant changes to its business which will principally leave the club's stadium, academy and junior development centre free and clear of debt.

However, it has effectively sold its Chinese sister club Chengdu Blades and their stake in the Copthorne Hotel to offset sizeable losses elsewhere.

The Blades have been badly affected by the removal of the 13m parachute payment previously enjoyed in its last two seasons and a large over-spend on players' wages in their ultimately unsuccessful bid to secure promotion last season.

Birch told the Yorkshire Post: "The losses are disappointing, of course – they are substantial.

"But all these clubs that did get parachute payments are finding it incredibly tough to compete if you're going to run with high players' wages, which is what we have done.

"You only have to look along the road at (Sheffield) Wednesday and all those who have also been relegated from the Championship into League One, each trying to re-establish after relegation; it's incredibly difficult.

"However, we're still here (in the Championship) with all our assets. It's not a bad place to be and – with the support of chairman Kevin McCabe – it gives us a great platform.

"We know that, going forward, you have to get your act together and live within your means. It's all about being smarter and being a bit more back to basics.

"What the restructuring does most importantly is leave our remaining property assets – Bramall Lane, the Academy at Shirecliffe and Junior Development Centre at Crookes – free of bank debt and the aim is, by early 2013, to be completely free from external debt."

United are currently 18th in the table and the financial clout to fulfil their desire to return to the Premier League – they were relegated in 2007 – is set to be drawn in.

"We have got to take a view it's a long-term project now and this is a period of consolidation while we re-group to have another go," said Birch.

"It might not be immediate. Having said that, I did think that we've got a squad more than capable of achieving promotion this season and we're still not a million miles away."

Gary Speed's side remain only five points off the play-off places but it remains unlikely they will receive additional funds to bolster their push – unless they find fresh investment – as they did last year when an unbudgeted 2.5m was spent on loan players.

In the year-ending June 30 2010, turnover was down by more than 50 per cent to 10m and, while United had made that 6m profit the previous year, it included the one-off 18.1m payment from West Ham following the Carlos Tevez affair so the comparable loss figure is 12.1m.

Gate receipts also fell by 2m, mainly because they did not enjoy a run in the play-offs when they reached Wembley in 2008-09.

Birch is wary of the "boom and bust" mentality of some clubs and realises their Premier League goal is only attainable on a different course.

"I see West Brom as the ideal model to follow," he said.

"They've had setbacks but are making gradual steps to the stage now where they are a very solid Premier League club all around.

"But I think, if we did get promoted, with our infrastructure and everything that is sorted off the pitch, we'd be able to concentrate on the playing squad this time."

McCabe said: "Some tough decisions have been taken to totally reshape the group.

"The length and depth of today's economic conditions, coupled with the introduction of four-year parachute payments, has led us to challenging previous assumptions on how best to structure Sheffield United.

"The time is right to ensure the club is positioned to avoid the type of damage that is currently afflicting or set to affect so many other football clubs.

"Our aim is still to generate revenue and profits from our business to fund all football activities with the clear objective of getting United back to the Premier League at the earliest opportunity.

"I firmly believe that the Blades are now in the right position to progress."

United, meanwhile, will hold their annual general meeting on December 18.

UNITED MAKE MOVES TO CUT THEIR CLOTH ACCORDINGLY

WHILE reductions were achieved in the cost of the playing squad last season, United's pursuit of Premier League football saw them maintain one of the largest Championship wage bills, expanded when major injury problems saw 14 recruits brought in on loan including top-flight Richard Cresswell (Stoke), Nyron Nosworthy (Sunderland) and Kyle Bartley (Arsenal).

Property assets were written down by 10m as a result of the re-structuring while the largest element lost in its turnover was television income, decreased to 4.4m (2009: 14.4m).

Through arrangements with new banker Santander UK plc, United become clear of any bank debt other than funds from Santander secured against the residue "Tevez monies" due from West Ham between now and 2013. Chengdu Blades interests have been sold to a Chinese investor but an agreement remains in place to assist in the overall management of the club.

Likewise, United's interest in the Copthorne Hotel has been sold to Scarborough Partnership Ltd at market value but an option to re-purchase as and when economic conditions improve is retained.