HKF Hancock Fabrics

Hancock Fabrics, Inc. (NYSE: HKF), today reported that sales in the four-week period ended July 29, 2006 totaled $25.7 million compared with $26.0 million in the same period of the prior year. Sales in comparable stores increased 1.3% in July. In the second quarter, total sales were $86.0 million versus $83.2 million in the same period of fiscal 2005, and comparable store sales were up 4.6%. Year-to-date, total sales were $179.6 million in 2006 and $181.1 million in 2005. Comparable store sales, for the six months to date, declined 0.3%, including a 5.5% benefit from stores that are being liquidated in connection with store closing sale events. Hancock Fabrics, Inc. - America's Fabric Store - is committed to serving creative enthusiasts with a complete selection of fashion and home decorating fabrics, sewing accessories, needlecraft supplies and sewing machines. The Company operates 425 retail stores in 41 states and an Internet store at www.hancockfabrics.com.