BILLY Davies today insisted he was proud of his injury-ravaged Nottingham Forest squad and pledged: "We will turn things around this season."

The Reds suffered a painful 3-2 defeat at the hands of East Midlands rivals Derby County, ending their dreams of an FA Cup fifth round clash with Manchester United.

But, with 11 players injured, suspended or Cup-tied, Davies said that Forest could be encouraged by their performance and the character and determination they showed, despite seeing the Rams claw their way back from 2-0 down.

The manager conceded that the match was another clear indication of the need for new signings.

But he said he will continue to work with the current squad to make sure they continue their climb away from Championship trouble.

"We are a club that is crying out for a bigger, deeper squad, no doubt," he said. "But you work with what you have to work with and, as I have said before, I have no complaints.

"I will continue to work very hard with these players. I have told them to be proud of what they have done. It was a fantastic game and they competed well.

"My message to the players was clear – be very proud of what you have achieved in the sense of what you were competing against.

"They were against a side not long out of the Premier League, a side that has spent parachute payments to assemble a massive squad and a side that – when we are throwing on the likes of Mark Byrne and Joe Heath and putting Wes Morgan up front as a striker – have a big bench to chose from.

"We also lost James Perch, our captain, which was a massive blow. These are not excuses, merely facts.

"We had central defenders at full back and, by the end, central defenders playing centre forward. We are doing what we can to get results.

"I came here because I looked at the big picture. Not so long ago, when I took over at Derby, we had a very similar situation, in terms of where that club was and where Forest are now.

"I know what is going on at this football club, where we are – and it will take us time to build it up.

"This season is all about stability, we know that. We will start our major surgery in the summer time.

"I came here knowing the challenge ahead and I will thoroughly enjoy turning Nottingham Forest around.

"The signs were there four weeks ago. We are where we are.

"We are a club that has come from the lower divisions and found ourselves in the Championship."