Have her sound out only the first letter of each word. As you read, pause at the beginning, and have her tell you the beginning sound of the word. Your reading will sound something like this: A-Ann's C-Cat. A-Ann H-Has a-a C-Cat. As she gets better at reading words, she will be able to read some of them on her own.

A says A (short sound), A says A, Every letter makes a sound and A says A.

B says Buh, B says Buh, Every letter makes a sound and B says Buh.

Repeat with every letter.