Sit where both you and the child are comfortable. Maybe she wants to sit in your lap, or maybe he wants his own space on the floor while you are on the couch. Wherever the child chooses, respect his wishes. This will help the child focus instead of fidget.
Read slowly and enunciate. If the child is facing you and can see your lips move, be mindful of shaping each word on your lips. Children with hearing problems often learn to read lips, so speak slowly - but not so slowly that the child will get bored.
If the child is next to you and can see the book, follow the words as you say them with your finger. This will help the child learn to connect the visual and aural expressions of the words.
Pay attention to the child's body language. If she fidgets a lot, perhaps she isn't comfortable and needs to move. If he cocks his head to one side as you speak, that may be a sign that he has better hearing in that ear, so adjust your reading accordingly. If she is looking around at other things, find out what she is thinking about; maybe you are reading too slowly, or she doesn't like the book.
Ask the child questions about the story. Try questions like "What do you think will happen next?" and "Why does this character feel that way?" - questions that engage the child and invite him into the story, and are age-appropriate. This will ensure that he comprehends and that you are moving at his pace.
Read with emotion in your voice. If he doesn't hear every word, he will still hear the tone of voice with which you say it - and that can tell more of a story than the words sometimes. Be expressive. This will help the child understand the story and feel emotionally engaged.