Blacks Leisure continues to cast a dark cloud over JD Sports Fashion and was blamed for a 20 per cent plunge in full-year profits as the group struggles to integrate the beleaguered business that it bought out of administration.
JD admitted that results had been "more disappointing than originally anticipated" at its Blacks and Milletts chains and said it faced a number of "short-term challenges".
In fact, the outdoor-clothing division turned in an operating loss of £15m for the 53 weeks to 3 February.
Having bought the company out of administration for £20m last year, JD initially backed the existing management team, but subsequently instituted a shake-up as results continued to disappoint.
It axed 122 Blacks and Millets stores over the year, leaving 174 outdoor-clothing outlets in the UK with a long-term target of paring the number back to 140.
However, the group has granted the Millets brand a reprieve after concluding there is a place on the high street for the camping chain.
The 20 per cent fall left pre-tax profits at £60.5m, despite a strong performance from the sports shops and fashion stores which fared well despite the ongoing consumer squeeze.
Sales were up 2.5 per cent at the core sports shops which have been open at least a year, and 1.9 per cent ahead in the nine weeks to 6 April.
Overall group revenue was up by 19 per cent at £1.26bn. The total divided has been raised 4 per cent to 26.3p.
The executive chairman Peter Cowgill insisted there is better to come saying: "Whilst the board recognises that recent acquisition activity has impact on short-term returns, it remains confident the group is well positioned to deliver earnings growth and increased shareholder returns over the longer term."
However, the business still faces a number of challenges, not least the buy up of fashion retailer Republic out of administration by Mike Ashley's Sports Direct. That was seen by analysts as an attempt by the discounter to cut in on the higher end of the market that JD has made its own.