Teen apparel retailer Delia's cut its second quarter loss marginally to US$5m from $5.1m last year, thanks to buoyant retail revenues.

The company's sales for the three months to 2 August were up 10.8% to $58.1m, led by a 22% hike in retail sales to $23.6m.

Direct revenues were up 4.3% to $34.5m, and overall comparable store sales increased 5.2%.

Gross margins were 35.3% during the quarter, up from 34.6% during the same period last year - helped by improvements in initial mark-ups and full price selling.

However, these improvements were partially offset by higher shipping costs in the direct segment, the company said.

Direct operating income was $0.7m, up from $0.4m in the same period last year, while the company's retail operations recorded a $5.5m loss, compared to a $5.7m loss last year.

"We are pleased with our important back-to-school selling period so far, with high single-digit comps in July and continued strength thus far in August," said Robert Bernard, Delia's CEO.

"We have said that back-to-school would mark an inflection point for the Delia's brand, and these results are indicative of why we are quite optimistic about our future."

First-half revenues were up 10.4% to $121.7m, with the net loss $8.9m, up from last year's figure of $8.4m.