To update an app, unlock the download item (file) and edit the version number and upload the new file. Then re-lock the file in order to submit it for verification.
The new version will then go through the verification process as usual, and you'll receive an email once it has passed.
After it's passed verification, it will then replace the previous version in the store (this can take anything from a day to a week, they seem to sync updates to the store in batches, so it depends how long before the next refresh). The old version will be available in the store the entire time this process is going on.