COST-CUTTING measures - including reducing its wage bill by half - helped Sunderland to reduce operating costs by more than £20m as the club adjusted to its first season outside the Premier League.

The club, which published its end of year results yesterday, said that on and off the field, it was in a healthy position to push for promotion.

The club's relegation led to a loss of media revenue of nearly £10m, which resulted in a 33 per cent fall in turnover.

A reorganisation of the business, which included redundancies, meant losses before tax were £1.2m, compared with £20.6m last year.

Chief executive Peter Walker said Sunderland had coped well with the huge drop in revenue resulting from the loss of its Premiership status.

Mr Walker said: "You only have to look at the other clubs that were relegated to see how difficult it is to adjust. There is a huge gulf between the Championship and the Premier League.

"It is a difficult balancing act, because we have to show the ambition needed to get promotion, but it is important we don't over-extend ourselves and get into financial problems."

Despite reducing its wage bill to £16.9m, Sunderland still has much higher wage costs than most other Championship clubs, where the average is about £7m.

The club has stabilised its debt at between £35m and £40m.

Mr Walker said despite cost-saving measures, Sunderland was determined to retain its top players, having already rejected approaches for Julio Arca and George McCartney.

Chairman Bob Murray said automatic promotion remained the ultimate goal.

He said: " Promotion back to the Premiership at the earliest opportunity is our goal. Our aim is to deliver the best squad possible within our financial resources and maximise the opportunity for promotion. By managing the business as cost-effectively as possible, we can help to increase investment in the team.

"Our industry is changing faster than ever before and it is vital that the club and its supporters move forward together and return to the Premier League where we all know the club belongs."