Sheffield were beaten at Guildford Flames in the second leg and lost the chance of playing a lucrative tie with Nottingham Panthers in the semi-final.
"It was painful, in financial terms, to say the least," said Smith, after the 8-9 aggregate defeat.
"It is a '˜Boxing Day' type of blow" he said, referring to the regular, moneyspinning ties withÂ Panthers, in the regular post-Christmas-time fixture list.
"Home and away games with Nottingham would have been great for our bottom line - and Nottingham's,Â where it would have been a sell-out.
"I want our team to be in all the big games for all sorts of reasons, including the fact that this is an expensive sport to run. It is unfortunate for us."
Smith said that in the Summer months he'd thought that then-coach Paul Thompson's assembled team wouldÂ have been a contender for honours.
"It has not quite panned out that way. I think I have rarely experienced in my eight years withÂ Steelers the team being out of the top three or four. We are seventh, and that is unusual and itÂ will be a hard slog to get back towards the top."
Smith accepts the chances of League silverware are worse than remote.
"I think you have to say its gone. You have to be realistic - we have slim to no chance. But theÂ results have not been connected to a lack of spending as some people say.
"We gave Paul a good budget, second or third highest in the league. With all the movement that weÂ have seen, (since) this is the most expensive team we've had.
"But in my years here we have never refused a coach when he has needed replacements. If Tom BarrassoÂ needs more cash, we will find it" said the owner.
"We are not going to pull the plug on what Tom needs right now. We want to give the fans what they want, out there on the ice.'
Steelers have won only two of their last seven matches in cup and league competitions.Â
In a quirk of the fixture list, they face Guildford, again, on Saturday, at Sheffield Arena.