URGI United Retail Grp. (MM)

United Retail Group, Inc. (NASDAQ-NMS: �URGI�) today announced that net sales decreased 2% to $55.7 million during December 2006 from $56.6 million during December 2005. Comparable store sales decreased 2% for the month versus a 16% increase in December 2005. Net sales were $91.7 million in the first two months of the fourth quarter in both fiscal 2006 and fiscal 2005. Comparable store sales were flat for the fiscal quarter to date versus an 11% increase in the prior year period. For the fiscal year to date, net sales increased 4% to $426.3 million from $411.0 million in the same period last year. Comparable store sales increased 4% for the fiscal year to date on top of an 11% increase in the prior year period. Comparable store sales data does not include online (�Shop @ Home�) sales. Shop @ Home sales increased 53% for the month of December, 46% for the fiscal quarter to date and 50% for the fiscal year to date. Raphael Benaroya, the Company�s Chairman, President and Chief Executive Officer, commented: �Even in the context of all time record sales in December last year, I clearly expected more this December. The unseasonably warm weather during the month impacted sales of heavy winter merchandise. Nevertheless, we chose not to engage in deeper promotional activity than last December�s. After New Year�s, we have taken the necessary steps to address residual inventory to clear the way for Spring selling.� United Retail Group, Inc. is a specialty retailer of large-size women�s fashion apparel, footwear and accessories featuring AVENUE� brand merchandise. The Company operates 492 AVENUE� stores with 2,166,000 square feet of selling space, as well as the AVENUE.COM� website at www.avenue.com. The above release contains certain brief forward-looking statements concerning the Company�s operations and performance. The Company cautions that any forward-looking statements are summary in nature, involve risks and uncertainties and are subject to change based on various important factors, many of which may be beyond the Company�s control. Accordingly, the Company�s future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. The following additional factors, among others, could also affect the Company�s actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements included in this release or otherwise made by management: threats of terrorism; war risk; shifts in consumer spending patterns, overall economic conditions; the impact of increased competition; variations in weather patterns; uncertainties relating to execution of the Company�s product repositioning strategy; store lease expirations; increases in interest rates; the ability to retain, hire and train key personnel; risks associated with the ability of the Company�s manufacturers to deliver products in a timely manner; political instability and other risks associated with foreign sources of production and increases in fuel costs. The reports filed by the Company with the Securities and Exchange Commission contain additional information on these and other factors that could affect the Company�s operations and performance. The Company does not intend to update the forward-looking statements contained in the above release, which should not be relied upon as current after today�s date.