May 20 (Reuters) - Casual Male Retail Group Inc (CMRG.O) reported a quarterly profit that beat expectations as it boosted margins through tight cost controls, and the men's apparel retailer raised its earnings view for the current financial year.

Photo: www.casualretail.com

For 2010, the retailer, which has been cutting costs and tightly managing inventories to counter sales declines, now expects to earn 26 cents to 29 cents a share. It had earlier forecast a profit of 23 cents to 26 cents a share.

Analysts on average had forecast a profit of 26 cents a share, according to Thomson Reuters I/B/E/S..

"While customers continue to be mindful of their discretionary spending on apparel, we are seeing an increased willingness to spend when the weather is favorable," CEO David Levin said in a statement.

For the first quarter ended May 1, the company earned $4.2 million, or 9 cents a share, compared with $0.3 million, or 1 cent a share, a year ago.

Sales fell 3 percent to $95 million.

Analysts on average had expected earnings of 6 cents a share on revenue of $94.2 million.

Gross margin increased 330 basis points to 45.9 percent, reflecting a 280 basis point improvement in merchandise margin.

Shares of the Canton, Massachusetts-based retailer closed at $3.54 Wednesday 19 May on Nasdaq. (Reporting by Viraj Nair in Bangalore; Editing by Jarshad Kakkrakandy) (([email protected]; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: [email protected]))