JD Sports Fashion said today that “significant improvement” at Blacks and Millets had lifted the outdoor brands out of the red following a two-year struggle.

The group said the two retail brands achieved a break-even position in the second half of the year to February 1, compared with losses of £4.9million a year earlier, and that it expected further improvement this year.

Across the group, annual underlying profits were 27% higher at £77m as continued strong growth for core sports retail brands JD and Size? more than offset bigger losses at its fashion division brands Bank and Scotts.

Profits from the sports stores increased by £15.5m to £93.4m but fashion racked up losses of £6.4m as Bank struggled in the face of a significant shift in the youth market towards own brand and online retailing.

Under a new managing director, JD is working to re-establish Bank’s reputation in branded fashion and to produce a faster turnaround of ranges through a more flexible supply chain.

JD Sports has found the task of reviving its outdoor brands harder than expected after buying Blacks Leisure, which included Millets, out of administration in January 2012.

It has reduced the number of stores under the two fascias to 156 and relocated offices and warehousing to its own facilities as part of a turnaround plan.

The two brands are also being run with separate and significantly changed commercial teams as JD said they attract different types of customers.

Executive chairman Peter Cowgill added: “Inevitably, improvements in financial performance lag operational changes but I am encouraged that the Blacks and Millets business achieved a significant improvement in the second half of the year and we expect continued progress in the new financial year.”

The company has 348 JD stores in the UK and Ireland, with Size?, Chausport, Sprinter and other JD outlets in Europe giving it a total of 563 sports shops. There are 89 Bank shops and 33 under the Scotts brand.