**FORM        10-Q**

**x**

**Champion        Industries, Inc.**

| West                  Virginia                                                  |   | 55-0717455                                            |
|---------------------------------------------------------------------------------|--------|-------------------------------------------------------|
| (State                  or other jurisdiction of incorporation or organization) |   | (I.R.S.                  Employer Identification No.) |

|  Large                  accelerated filer o |  Accelerated                  filer o   |  Non-accelerated                  filer x |
|--------------------------------------------------|--------------------------------------------------------|------------------------------------------------|

|  Class                                                    |   |  Outstanding                  at April 30, 2007 |
|----------------------------------------------------------------|--------|------------------------------------------------------|
|  Common                  stock, $1.00 par value per share |   |  9,962,913                  shares              |

**Champion        Industries, Inc.**

**INDEX**

|                                                                                                                                                                           |  **Page                  No.** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------|
|  Part                  I.   Financial                  Information                                                                                         |                                |
|       Item                  1.  Financial Statements                                                                                        |                                |
|          Consolidated                  Balance Sheets (Unaudited)                                                                 |  3                             |
|          Consolidated                  Statements of Income (Unaudited)                                                      |  5                             |
|          Consolidated                  Statements of Cash Flows (Unaudited)                                                       |  6                             |
|          Notes                  to Consolidated Financial Statements                                                              |  7                             |
|      Item                  2.  Management’s Discussion and Analysis of Financial Condition                  and Results of Operations | 15                                  |
|      Item                  3.  Quantitative and Qualitative Disclosure About Market                  Risk                                        |  20                            |
|      Item                  4.  Controls                  and Procedures                                                                          | 20                                  |
|  Part                  II. Other                  Information                                                                                                        |                                |
|      Item                1A.  Risk Factors                                                                                                       |                  21            |
|      Item                  4.                   Submission                  of Matters to a Vote of Security Holders                             |  21                            |
|      Item                  6.                   Exhibits                                                                                         | 21                                  |
|  Signatures                                                                                                                                                               | 22                                  |

----

**PART        I - FINANCIAL INFORMATION**

**Item        1. Financial Statements**

**Champion        Industries, Inc. and Subsidiaries**

**Consolidated        Balance Sheets**

| **ASSETS**                                                                                                                    |   | **April                  30,**    |   |   |   | **October                  31,** |   |
|-------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|--------|--------|--------|----------------------------------|--------|
|                                                                                                                          |   | **2007****(Unaudited)**           |   |   |   | **2006****(Audited)**            |   |
| Current                  assets:                                                                                              |   |                              |   |   |   |                             |   |
|                       Cash and cash equivalents                                                           |   | **$                  4,091,855**  |   |   |   | $                  5,486,577     |   |
|                       Accounts receivable, net of allowance of $1,499,000 and                  $1,558,000 |   | **19,994,410**                    |   |   |   | 20,638,823                       |   |
|                        Inventories                                                                   |   | **10,909,049**                    |   |   |   | 10,986,590                       |   |
|                       Other current assets                                                                |   | **1,094,916**                     |   |   |   | 618,549                          |   |
|                       Deferred income tax assets                                                          |   | **1,235,599**                     |   |   |   | 1,200,037                        |   |
|     Total                  current assets                                                                 |   | **37,325,829**                    |   |   |   | 38,930,576                       |   |
|                                                                                                                          |   |                              |   |   |   |                             |   |
|                                                                                                                          |   |                              |   |   |   |                             |   |
|                       Property and equipment, at cost:                                                    |   |                              |   |   |   |                             |   |
|     Land                                                                                                  |   | **2,023,375**                     |   |   |   | 2,023,375                        |   |
|     Buildings                  and                  improvements                                          |   | **9,005,022**                     |   |   |   | 8,731,280                        |   |
|     Machinery                  and                  equipment                                             |   | **48,177,308**                    |   |   |   | 46,757,859                       |   |
|     Furniture                  and                  fixtures                                              |   | **3,696,232**                     |   |   |   | 3,620,783                        |   |
|     Vehicles                                                                                              |   | **3,427,669**                     |   |   |   | 3,453,415                        |   |
|                                                                                                                          |   | **66,329,606**                    |   |   |   | 64,586,712                       |   |
|     Less                  accumulated depreciation                                                        |   | **(46,968,674**                   | **)**  |   |   | (45,541,027                      | )      |
|                                                                                                                          |   | **19,360,932**                    |   |   |   | 19,045,685                       |   |
|                                                                                                                          |   |                              |   |   |   |                             |   |
|                       Cash surrender value of officers’ life insurance                              |   | **1,202,696**                     |   |   |   | 1,202,696                        |   |
|                       Goodwill                                                                            |   | **3,411,511**                     |   |   |   | 3,411,511                        |   |
|                       Other intangibles, net of accumulated amortization                                  |   | **2,950,969**                     |   |   |   | 3,125,691                        |   |
|                       Other assets                                                                        |   | **327,027**                       |   |   |   | 272,567                          |   |
|                                                                                                                          |   | **7,892,203**                     |   |   |   | 8,012,465                        |   |
|     Total                  assets                                                                         |   | **$                  64,578,964** |   |   |   | $                  65,988,726    |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Consolidated        Balance Sheets (continued)**

| **LIABILITIES                  AND SHAREHOLDERS’ EQUITY**                                                                                                                                          | **April                  30,** |                              | **October                  31,** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|-----------------------------------|----------------------------------|--------|
|                                                                                                                                                                                                     | **2007****(Unaudited)**        |                              | **2006****(Audited)**            |   |
| Current                  liabilities:                                                                                                                                                                    |                           |                              |                             |   |   |   |
|                       Accounts payable                                                                                                                                               |                           | **$                  4,125,451**  |                             |   | $                  5,763,928 |   |
|                       Accrued payroll                                                                                                                                                |                           | **1,760,766**                     |                             |   | 2,169,878 |   |
|                       Taxes accrued and withheld                                                                                                                                     |                           | **1,345,323**                     |                             |   | 1,394,345 |   |
|                       Accrued income taxes                                                                                                                                           |                           | **337,024**                       |                             |   | 1,107,837 |   |
|                       Accrued expenses                                                                                                                                               |                           | **962,704**                       |                             |   | 925,070 |   |
|                       Current portion of long-term debt                                                                                                                              |                           | **1,560,468**                     |                             |   | 1,614,861 |   |
|     Total                  current liabilities                                                                                                                                       |                           | **10,091,736**                    |                             |   | 12,975,919 |   |
|                                                                                                                                                                                                     |                           |                              |                             |   |   |   |
| Long-term                  debt, net of current portion:                                                                                                                                                 |                           |                              |                             |   |   |   |
| Notes                  payable, line of credit                                                                                                                                                           |                           | **213,000**                       |                             |   | - |   |
| Notes                  payable, term                                                                                                                                                                     |                           | **4,051,267**                     |                             |   | 4,219,724 |   |
| Other                  liabilities                                                                                                                                                                       |                           | **388,047**                       |                             |   | 388,384 |   |
| Deferred                  income tax liabilities                                                                                                                                                         |                           | **3,468,136**                     |                             |   | 3,628,014 |   |
|     Total                  liabilities                                                                                                                                               |                           | **18,212,186**                    |                             |   | 21,212,041 |   |
| Shareholders’                  equity:                                                                                                                                                             |                           |                              |                             |   |   |   |
|                       Common stock, $1 par value, 20,000,000 shares authorized;                       9,962,913 and 9,922,913 shares issued and outstanding |                           | **9,962,913**                     |                             |   | 9,922,913 |   |
|                       Additional paid-in capital                                                                                                                                     |                           | **22,722,680**                    |                             |   | 22,636,620 |   |
|                       Retained earnings                                                                                                                                              |                           | **13,681,185**                    |                             |   | 12,217,152 |   |
| Total                  shareholders’ equity                                                                                                                                                        |                           | **46,366,778**                    |                             |   | 44,776,685 |   |
|     Total                  liabilities and shareholders’ equity                                                                                                                |                           | **$                  64,578,964** |                             |   | $                  65,988,726 |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Consolidated        Statements of Income **

|                                                                             |   | **Three                  Months Ended****April                  30,** | **Six                  Months Ended****April                  30,** |
|---------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------|---------------------------------------------------------------------|
|                                                                                  |   |                                                                  | **2007**                                                            |   |   | **2006** |   |   | **2007** |   |   | **2006** |   |
| Revenues:                                                                             |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
|                      Printing                                          |   | **$**                                                                 | **25,295,295**                                                      |   | **$** | **27,841,677** |   | **$** | **51,157,662** |   | **$** | **54,007,326** |   |
|                      Office products and office furniture              |   |                                                                  | **8,518,582**                                                       |   |   | **9,578,892** |   |   | **17,595,548** |   |   | **19,704,951** |   |
|     Total                  revenues                               |   |                                                                  | **33,813,877**                                                      |   |   | **37,420,569** |   |   | **68,753,210** |   |   | **73,712,277** |   |
|                                                                                  |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
| Cost                  of sales:                                                       |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
|                       Printing                                    |   |                                                                  | **17,752,603**                                                      |   |   | **19,155,034** |   |   | **35,990,905** |   |   | **37,705,574** |   |
|                       Office products and office furniture        |   |                                                                  | **5,869,953**                                                       |   |   | **6,753,428** |   |   | **12,219,956** |   |   | **13,897,176** |   |
|     Total                  cost of sales                          |   |                                                                  | **23,622,556**                                                      |   |   | **25,908,462** |   |   | **48,210,861** |   |   | **51,602,750** |   |
| Gross                  profit                                                         |   |                                                                  | **10,191,321**                                                      |   |   | **11,512,107** |   |   | **20,542,349** |   |   | **22,109,527** |   |
|                                                                                  |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |                    |
|     Selling,                  general and administrative expenses |   |                                                                  | **7,769,311**                                                       |   |   | **8,727,944** |   |   | **15,899,643** |   |   | **17,441,611** |   |
| Hurricane                  and relocation costs, net of recoveries                    |   |                                                                  | -                                                                   |   |   | **(43,733** | **)**  |   | **-** |   |   | **(301,693** | **)**  |
|                                                                                  |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
| Income                  from operations                                               |   |                                                                  | **2,422,010**                                                       |   |   | **2,827,896** |   |   |  **4,642,706** |   |   |  **4,969,609** |   |
|                       Other income (expense):                     |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
|                       Interest income                             |   |                                                                  | **12,842**                                                          |   |   | **7,383** |   |   | **18,073** |   |   | **14,125** |   |
|                       Interest expense                            |   |                                                                  | **(152,162**                                                        | **)** |   | **(168,828** | **)** |   | **(286,066** | **)** |   | **(340,570** | **)** |
|                       Other                                       |   |                                                                  | **14,858**                                                          |   |   | **3,042** |   |   | **18,880** |   |   | **2,928** |   |
|                                                                                  |   |                                                                  | **(124,462**                                                        | **)** |   | **(158,403** | **)** |   | **(249,113** | **)** |   | **(323,517** | **)** |
| Income                  before income taxes                                           |   |                                                                  | **2,297,548**                                                       |   |   | **2,669,493** |   |   | **4,393,593** |   |   | **4,646,092** |   |
|                       Income tax (expense)                        |   |                                                                  | **(907,806**                                                        | **)**  |   | **(1,091,079** | **)**  |   | **(1,735,691** | **)** |   | **(1,922,000** | **)** |
| Net                  income                                                           |   | **$**                                                                 | **1,389,742**                                                       |   | **$** | **1,578,414** |   | **$** | **2,657,902** |   | **$** | **2,724,092** |   |
|                                                                                  |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
| Earnings                  per share                                                   |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
|                       Basic                                       |   | **$**                                                                 | **0.14**                                                            |   | **$** | **0.16** |   | **$** | **0.27** |   | **$** | **0.28** |   |
|                       Diluted                                     |   | **$**                                                                 | **0.14**                                                            |   | **$** | **0.16** |   | **$** | **0.26** |   | **$** | **0.28** |   |
|                                                                                  |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
| Weighted                  average shares outstanding:                                 |   |                                                                  |                                                                |   |   |   |   |   |   |   |   |   |   |
|                       Basic                                       |   |                                                                  | **9,962,000**                                                       |   |   | **9,746,000** |   |   | **9,950,000** |   |   | **9,746,000** |   |
|                       Diluted                                     |   |                                                                  | **10,133,000**                                                      |   |   | **9,947,000** |   |   | **10,121,000** |   |   | **9,889,000** |   |
| Dividends                  per share                                                  |   | **$**                                                                 | **0.06**                                                            |   | **$** | **0.05** |   | **$** | **0.12** |   | **$** | **0.10** |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Consolidated        Statements of Cash Flows**

|                                                                                                            |   | **Six                  Months Ended April 30,** |           |
|-----------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------|----------------|
|                                                                                                            |   | **2007**                                        |           | **2006** |   |
| **Cash                  flows from operating activities:**                                                      |   |                                            |           |   |   |
| Net                  income                                                                                     |   | **$**                                           | **2,657,902**  |   | $ | **2,724,092** |   |
| Adjustments                  to reconcile net income to cash provided                  by operating activities: |   |                                            |           |   |   |   |   |
|                       Depreciation and amortization                                         |   |                                            | **1,853,982**  |   |   | **2,069,677** |   |
|                       (Gain) loss on sale of assets                                    |   |                                            | **(1,269**     | **)**  |   | **11,686** |   |
|      Deferred                  income taxes                                            |   |                                            | **(195,440**   | **)**  |   | **(270,583** | )  |
|                       Increase in deferred compensation                                     |   |                                            | **893**        |   |   | **1,787** |   |
|                       Bad debt expense                                                      |   |                                            | **177,687**    |   |   | **357,269** |   |
|      Hurricane                  and relocation costs, net of recoveries                |   |                                            | **-**          |   |   | **(301,693** | )  |
|                       Changes in assets and liabilities:                                    |   |                                            |           |   |   |   |   |
|     Accounts                  receivable                                                    |   |                                            | **466,726**    |   |   | **(3,430,251** | )  |
|     Inventories                                                                             |   |                                            | **77,541**     |   |   | **260,370** |   |
|     Other                  current assets                                                   |   |                                            | **(476,367**   | **)** |   | **(418,467** | ) |
|     Accounts                  payable                                                       |   |                                            | **(287,752**   | **)**  |   | **528,686** |   |
|     Accrued                  payroll                                                        |   |                                            | **(409,112**   | **)** |   | **(211,824** | ) |
|     Taxes                  accrued and withheld                                             |   |                                            | **(49,022**    | **)**  |   | **352,338** |   |
|     Income                  taxes                                                           |   |                                            | **(770,813**   | **)**  |   | **103,832** |   |
|     Accrued                  expenses                                                       |   |                                            | **37,634**     |   |   | **117,026** |   |
|     Other                  liabilities                                                      |   |                                            | **(1,230**     | **)** |   | **(2,052** | ) |
|                       Net cash provided by operating activities                             |   |                                            | **3,081,360**  |   |   | **1,891,893** |   |
|                                                                                                            |   |                                            |           |   |   |   |   |
| **Cash                  flows from investing activities:**                                                      |   |                                            |           |   |   |   |   |
| Purchases                  of property and equipment                                                            |   |                                            | **(1,934,269** | **)** |   | **(1,109,538** | ) |
| Proceeds                  from sales of property                                                                |   |                                            | **78,796**     |   |   | **67,713** |   |
| Goodwill                  additions                                                                             |   |                                            | **(1,350,725** | **)** |   | **-** |   |
| Other                  assets                                                                                   |   |                                            | **(60,461**    | **)**  |   | **(56,735** | )  |
|                       Net cash used in investing activities                                 |   |                                            | **(3,266,659** | **)** |   | **(1,098,560** | ) |
|                                                                                                            |   |                                            |           |   |   |   |   |
| **Cash                  flows from financing activities:**                                                      |   |                                            |           |   |   |   |   |
| Borrowings                  on line of credit                                                                   |   |                                            | **7,877,000**  |   |   | **7,517,000** |   |
| Payments                  on line of credit                                                                     |   |                                            | **(7,664,000** | **)** |   | **(8,105,000** | ) |
| Proceeds                  from term debt                                                                        |   |                                            | **1,675,633**  |   |   | **80,010** |   |
| Principal                  payments on long-term debt                                                           |   |                                            | **(2,030,247** | **)** |   | **(1,273,132** | ) |
| Proceeds                  from exercise of stock options                                                        |   |                                            | **126,060**    |   |   | -  |   |
| Dividends                  paid                                                                                 |   |                                            | **(1,193,869** | **)** |   | **(974,588** | ) |
|                       Net cash used in financing activities                                 |   |                                            | **(1,209,423** | **)** |   | **(2,755,710** | ) |
| Net                  decrease in cash and cash equivalents                                                      |   |                                            | **(1,394,722** | **)**  |   | **(1,962,377** | )  |
| Cash                  and cash equivalents, beginning of period                                                 |   |                                            | **5,486,577**  |   |   | **3,661,622** |   |
| Cash                  and cash equivalents, end of period                                                       |   | **$**                                           | **4,091,855**  |   | $ | **1,699,245** |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)**

**April        30, 2007**

**1.        Basis of Presentation and Business Operations**

*How        Sales Taxes Collected from Customers and Remitted to Government Authorities        Should be Presented in the Income Statement” *

**2.        Earnings per Share**

**3.        Inventories**

|                                                  |   | **April                  30,** |           | **October                  31,** |   |
|-------------------------------------------------------|--------|--------------------------------|----------------|----------------------------------|--------|
|                                                  |   | **2007**                       |           | **2006**                         |   |
| Printing:                                             |   |                           |           |                             |   |
| Raw                  materials                        |   | **$**                          | **2,135,079**  |                             | $      | 2,121,843 |   |
| Work                  in process                      |   |                           | **1,811,748**  |                             |   | 1,800,517 |   |
| Finished                  goods                       |   |                           | **4,431,635**  |                             |   | 4,404,162 |   |
| Office                  products and office furniture |   |                           | **2,530,587**  |                             |   | 2,660,068 |   |
|                                                  |   | **$**                          | **10,909,049** |                             | $      | 10,986,590 |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)        (continued)**

**4.        Long-Term Debt**

|                                                    |   | **April                  30,** |                                                              | **October                  31,** |    |
|---------------------------------------------------------|--------|--------------------------------|-------------------------------------------------------------------|----------------------------------|---------|
|                                                    |   | **2007**                       |                                                              | **2006**                         |    |
| Secured                  term note payable              |   |  **$**                    | **                        394,704** |                             |  $ | 452,386 |   |
| Installment                  notes payable to banks     |   |                           | **5,217,031**                                                     |                             |    | 5,382,199 |   |
|                                                    |   |                           | **5,611,735**                                                     |                             |    | 5,834,585 |   |
| Less                  current portion                   |   |                           | **1,560,468**                                                     |                             |    | 1,614,861 |   |
| Long-term                  debt, net of current portion |   | **$**                          | **4,051,267**                                                     |                             | $       | 4,219,724 |   |

**5.        Shareholders’ Equity**

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)        (continued)**

**6.        Commitments and Contingencies**

|                                               |   | **Payments                    Due by Fiscal Year** |
|----------------------------------------------------|--------|----------------------------------------------------|
| **Contractual                    Obligations**     |   | **2007**                                           |   | **2008** |   | **2009** |   | **2010** |   | **2011** |   | **Total** |   |
|                                               |   |                                               |   |   |   |   |   |   |   |   |   |   |   |
| Non-cancelable                    operating leases |   | $                                                  | 553,833 |   | $ | 930,247 |   | $ | 532,666 |   |  $ | 255,056 |   |  $ | 157,042 |   |  $ | 2,428,844 |   |
|                                               |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revolving                    line of credit        |   |                                               | - |   |   | - |   |   | - |   |   | 213,000  |   |   | - |   |   | 213,000 |   |
|                                               |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Term                    debt                       |   |                                               | 768,387 |   |   | 1,503,866 |   |   | 1,048,875 |   |   | 1,821,598 |   |   | 469,009 |   |   | 5,611,735 |   |
|                                               |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equipment                    purchase obligations  |   |                                               |   1,614,400 |   |   | - |   |   | -  |   |   | -  |   |   |  - |   |   | 1,614,400 |   |
|                                               |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                               |   | $                                                  | 2,936,620 |   | $ | 2,434,113 |   | $ | 1,581,541 |   |   | 2,289,654 |   |  $ | 626,051 |   |  $ | 9,867,979 |   |

**7.        Accounting for Stock-Based Compensation**

*Share-Based        Payment*
*Accounting        for Stock-Based Compensation*

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)        (continued)**

**8.        Acquisitions**

**9.        Accounting for Costs Associated with Exit or Disposal Activities        and Impact of Hurricane Katrina**

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)        (continued)**

| Personnel                                                    |   | $      | 88,423    |   |
|--------------------------------------------------------------|--------|--------|-----------|--------|
| Plant                                                        |   |   | 745,035   |   |
| Allowance                  for doubtful accounts             |   |   | 208,310   |   |
| Moving                  and relocation costs                 |   |   | 255,215   |   |
|                                                         |   |   |      |   |
| Total                  pre-tax hurricane expense             |   |   | 1,296,983 |   |
| Lease                  settlement recovery              |   |   | 75,583    |   |
| Insurance                  recoveries                        |   |   | 577,677   |   |
| Total                  recoveries                            |   |   | 653,260   |   |
| Cumulative                  impact of Hurricane Katrina, net |   | $      | 643,723   |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)        (continued)**

**10.        Industry Segment Information**

|                                                 |   |  **Office                  Products** |       |
|------------------------------------------------------|--------|--------------------------------------------|------------|
| **2007                  Quarter 2**                  |   | **Printing**                               |       | **&                  Furniture** |   | **Total** |   |
|                                                 |   |                                       |       |   |   |   |   |
| Revenues                                             |   | $                                          | 28,525,389 |   | $ | 10,594,012 |   | $ | 39,119,401 |   |
| Elimination                  of intersegment revenue |   |                                       | (3,230,094 | ) |   | (2,075,430 | ) |   | (5,305,524 | ) |
| Consolidated                  revenues               |   | $                                          | 25,295,295 |   | $ | 8,518,582 |   | $ | 33,813,877 |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Operating                  income                    |   |                                       | 1,993,241  |   |   | 428,769 |   |   | 2,422,010 |   |
| Depreciation                  & amortization     |   |                                       | 845,341    |   |   | 53,244 |   |   | 898,585 |   |
| Capital                  expenditures                |   |                                       | 889,688    |   |   | 15,127 |   |   | 904,815 |   |
| Identifiable                  assets                 |   |                                       | 54,811,408 |   |   | 9,767,556 |   |   | 64,578,964 |   |
| Goodwill                                             |   |                                       | 2,226,837  |   |   | 1,184,674 |   |   | 3,411,511 |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
|                                                 |   |  **Office                  Products** |       |
| **2006                  Quarter 2**                  |   |  **Printing**                         |       | **&                  Furniture** |   | **Total** |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Revenues                                             |   | $                                          | 32,014,163 |   | $ | 11,838,155 |   | $ | 43,852,318 |   |
| Elimination                  of intersegment revenue |   |                                       | (4,172,486 | ) |   | (2,259,263 | ) |   | (6,431,749 | ) |
| Consolidated                  revenues               |   | $                                          | 27,841,677 |   | $ | 9,578,892 |   | $ | 37,420,569 |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Operating                  income                    |   |                                       | 2,220,966  |   |   | 606,930 |   |   | 2,827,896 |   |
| Depreciation                  & amortization     |   |                                       | 979,864    |   |   | 39,672 |   |   | 1,019,536 |   |
| Capital                  expenditures                |   |                                       | 793,197    |   |   | 81,920 |   |   | 875,117 |   |
| Identifiable                  assets                 |   |                                       | 51,534,191 |   |   | 10,280,382 |   |   | 61,814,573 |   |
| Goodwill                                             |   |                                       | 1,774,344  |   |   | 286,442 |   |   | 2,060,786 |   |

----

**Champion          Industries, Inc. and Subsidiaries**

**Notes            to Consolidated Financial Statements (Unaudited)            (continued)**

|                                                 |   |  **Office                  Products** |       |
|------------------------------------------------------|--------|--------------------------------------------|------------|
| **2007                  Year to Date**               |   |  **Printing**                         |       | **&                  Furniture** |   | **Total** |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Revenues                                             |   | $                                          | 57,524,913 |   | $ | 21,823,952 |   | $ | 79,348,865 |   |
| Elimination                  of intersegment revenue |   |                                       | (6,367,251 | ) |   | (4,228,404 | ) |   | (10,595,655 | ) |
| Consolidated                  revenues               |   | $                                          | 51,157,662 |   | $ | 17,595,548 |   | $ | 68,753,210 |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Operating                  income                    |   |                                       | 3,732,890  |   |   | 909,816 |   |   | 4,642,706 |   |
| Depreciation                  & amortization     |   |                                       | 1,749,604  |   |   | 104,378 |   |   |                                 1,853,982 |   |
| Capital                  expenditures                |   |                                       | 2,021,603  |   |   | 44,430 |   |   | 2,066,033 |   |
| Identifiable                  assets                 |   |                                       | 54,811,408 |   |   | 9,767,556 |   |   | 64,578,964 |   |
| Goodwill                                             |   |                                       | 2,226,837  |   |   | 1,184,674 |   |   | 3,411,511 |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Notes        to Consolidated Financial Statements (Unaudited)        (continued)**

|                                                 |   |  **Office                  Products** |       |
|------------------------------------------------------|--------|--------------------------------------------|------------|
| **2006                  Year to Date**               |   |  **Printing**                         |       | **&                  Furniture** |   | **Total** |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Revenues                                             |   | $                                          | 61,702,192 |   | $ | 24,300,439 |   | $ | 86,002,631 |   |
| Elimination                  of intersegment revenue |   |                                       | (7,694,866 | ) |   | (4,595,488 | ) |   | (12,290,354 | ) |
| Consolidated                  revenues               |   | $                                          | 54,007,326 |   | $ | 19,704,951 |   | $ | 73,712,277 |   |
|                                                 |   |                                       |       |   |   |   |   |   |   |   |
| Operating                  income                    |   |                                       | 3,668,714  |   |   | 1,300,895 |   |   | 4,969,609 |   |
| Depreciation                  & amortization     |   |                                       | 1,994,962  |   |   | 74,715 |   |   | 2,069,677 |   |
| Capital                  expenditures                |   |                                       | 1,005,440  |   |   | 104,098 |   |   | 1,109,538 |   |
| Identifiable                  assets                 |   |                                       | 51,534,191 |   |   | 10,280,382 |   |   | 61,814,573 |   |
| Goodwill                                             |   |                                       | 1,774,344  |   |   | 286,442 |   |   | 2,060,786 |   |

|                                                      |   | **Three                  months** | **Six                  months** |
|-----------------------------------------------------------|--------|-----------------------------------|---------------------------------|
|                                                      |   |                              | **2007**                        |   |   | **2006** |   |   | **2007** |   |   | **2006** |   |
| Revenues:                                                 |   |                              |                            |   |   |   |   |   |   |   |   |   |   |
| Total                  segment revenues                   |   | **$**                             | **39,119,401**                  |   | **$** | **43,852,318** |   | **$** | **79,348,865** |   | **$** | **86,002,631** |   |
| Elimination                  of intersegment revenue      |   |                              | **(5,305,524**                  | **)** |   | **(6,431,749** | **)** |   | **(10,595,655** | **)** |   | **(12,290,354** | **)** |
| Consolidated                  revenue                     |   | **$**                             | **33,813,877**                  |   | **$** | **37,420,569** |   | **$** | **68,753,210** |   | **$** | **73,712,277** |   |
|                                                      |   |                              |                            |   |   |   |   |   |   |   |   |   |   |
| Operating                  income:                        |   |                              |                            |   |   |   |   |   |   |   |   |   |   |
| ** **Total                  segment operating income |   | **$**                             | **2,422,010**                   |   | **$** | **2,827,896** |   | **$** | **4,642,706** |   | **$** | **4,969,609** |   |
| Interest                  income                          |   |                              | **12,842**                      |   |   | **7,383** |   |   | **18,073** |   |   | **14,125** |   |
| Interest                  expense                         |   |                              | **(152,162**                    | **)** |   | **(168,828** | **)** |   | **(286,066** | **)** |   | **(340,570** | **)** |
| Other                  income                             |   |                              | **14,858**                      |   |   | **3,042** |   |   | **18,880** |   |   | **2,928** |   |
| Consolidated                  income before income taxes  |   | **$**                             | **2,297,548**                   |   | **$** | **2,669,493** |   | **$** | **4,393,593** |   | **$** | **4,646,092** |   |
|                                                      |   |                              |                            |   |   |   |   |   |   |   |   |   |   |
| Identifiable                  assets:                     |   |                              |                            |   |   |   |   |   |   |   |   |   |   |
| Total                  segment identifiable assets        |   | **$**                             | **64,578,964**                  |   | **$** | **61,814,573** |   | **$** | **64,578,964** |   | **$** | **61,814,573** |   |
| Elimination                  of intersegment assets       |   |                              | —                         |   |   | — |   |   | — |   |   | — |   |
| Total                  consolidated assets                |   | **$**                             | **64,578,964**                  |   | **$** | **61,814,573** |   | **$** | **64,578,964** |   | **$** | **61,814,573** |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Item        2. Management’s Discussion and Analysis of Financial Condition and Results of        Operations**

**Results        of Operations**

|                                                                                                   |   | **Percentage                  of Total Revenues**                           |
|--------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------|
|                                                                                                   |   |  **Three                  Months Ended****April                  30,** | **Six                  Months Ended****April                  30,** |
|                                                                                                   |   |                                                                        | **2007** |   |   | **2006** |   |   | **2007** |   |   | **2006** |   |
| Revenues:                                                                                              |   |                                                                        |   |   |   |   |   |   |   |   |   |                                     |   |
|                           Printing                             |   |                                                                        | **74.8** | **%** |   | **74.4** | **%** |   | **74.4** | **%** |   | **73.3** | **%** |
|                           Office products and office furniture |   |                                                                        | **25.2** |   |   | **25.6** |   |   | **25.6** |   |   | **26.7** |   |
|     Total                  revenues                                                |   |                                                                        | **100.0** |   |   | **100.0** |   |   | **100.0** |   |   | **100.0** |   |
|                                                                                                   |   |                                                                        |   |   |   |   |   |   |   |   |   |   |   |
| Cost                  of sales:                                                                        |   |                                                                        |   |   |   |   |   |   |   |   |   |   |   |
|                           Printing                             |   |                                                                        | **52.5** |   |   | **51.2** |   |   | **52.3** |   |   | **                                      51.2** |   |
|                           Office products and office furniture |   |                                                                        | **17.4** |   |   | **18.0** |   |   | **17.8** |   |   | **18.8** |   |
|     Total                  cost of sales                                           |   |                                                                        | **69.9** |   |   | **69.2** |   |   | **70.1** |   |   | **70.0** |   |
|                          Gross profit                               |   |                                                                        | **30.1** |   |   | **30.8** |   |   | **29.9** |   |   | **30.0** |   |
| S  Selllling,                  general and administrative expenses                           |   |                                                                        | **22.9** |   |   | **23.3** |   |   | **23.1** |   |   | **23.7** |   |
| Hurricane                  and relocation costs, net of recoveries                                |   |                                                                        | ** 0.0** |   |   | ** (0.1** | **) ** |   | **0.0** |   |   | **(0.4** | **) ** |
| Income                  from operations                                                                |   |                                                                        | **7.2** |   |   | **7.6** |   |   | **6.8** |   |   | **6.7** |   |
|                       Interest income                                              |   |                                                                        | **0.0** |   |   | **0.0** |   |   | **0.0** |   |   | **0.0** |   |
|                       Interest expense                                             |   |                                                                        | **(0.5** | **)** |   | **(0.5** | **)** |   | **(0.4** | **)** |   | **(0.4** | **)** |
|      Other                  income                                            |   |                                                                        | **0.1** |   |   | **0.0** |   |   | **0.0** |   |   | **0.0** |   |
| Income                  before taxes                                                                   |   |                                                                        | **6.8** |   |   | **7.1** |   |   | **6.4** |   |   | **6.3** |   |
|                       Income tax (expense)                                         |   |                                                                        | **(2.7** | **)**  |   | **(2.9** | **)**  |   | **(2.5** | **)** |   | **(2.6** | **)** |
| Net                  income                                                                            |   |                                                                        | **4.1** | **%** |   | **4.2** | **%** |   | **3.9** | **%** |   | **3.7** | **%** |

|                                                         |   | **Three                  Months Ended April 30, **  | **Six                  Months Ended April 30,** |
|--------------------------------------------------------------|--------|---------------------------------------------------------------|-------------------------------------------------|
|                                                         |   |                                                          | **2007**                                        |   |   | **2006** |   |   | **2007** |   |   | **2006** |   |
| Net                  income                                  |   | **$**                                                         | 1,390,000                                       |   | **$** | 1,578,000 |   | **$** | 2,658,000 |   | **$** | 2,724,000 |   |
| Insurance                  recoveries, net of expenses  |   |                                                          | -                                               |   |   | 26,000 |   |   | - |   |   | 176,000 |   |
| Core                  net income                             |   | **$**                                                         | 1,390,000                                       |   | **$** | 1,552,000 |   | **$** | 2,658,000 |   | **$** | 2,548,000 |   |

----

**Champion        Industries, Inc. and Subsidiaries**

**Management’s        Discussion and Analysis of Financial Condition **

**and        Results of Operations (continued)**

**Three        Months Ended April 30, 2007 Compared to Three Months Ended April 30,        2006**

*Revenues*

*Cost        of Sales*

*Operating        Expenses*

----

**Champion        Industries, Inc. and Subsidiaries**

**Management’s        Discussion and Analysis of Financial Condition **

**and        Results of Operations (continued)**

*Income        from Operations and Other Income and Expenses*

*Income        Taxes*

*Net        Income*

**Six        Months Ended April 30, 2007 Compared to Six Months Ended April 30,        2006**

*Revenues*

*Cost        of Sales*

*Operating        Expenses*

----

**Champion        Industries, Inc. and Subsidiaries**

**Management’s        Discussion and Analysis of Financial Condition **

**and        Results of Operations (continued)**

*Income        from Operations and Other Income and Expenses*

*Income        Taxes*

*Net        Income*

**Inflation        and Economic Conditions**

----

**Champion        Industries, Inc. and Subsidiaries**

**Management’s        Discussion and Analysis of Financial Condition **

**and        Results of Operations (continued)**

**Seasonality**

**Liquidity        and Capital Resources**

----

**Champion        Industries, Inc. and Subsidiaries**

**Management’s        Discussion and Analysis of Financial Condition **

**and        Results of Operations (continued)**

**Environmental        Regulation**

**Special        Note Regarding Forward-Looking Statements**

**ITEM        3. Quantitative and Qualitative Disclosure About Market        Risk**

**ITEM        4. Controls and Procedures**

----

**PART        II - OTHER INFORMATION**

**Item        1A. Risk Factors**

**Item        4. Submission of Matters to a Vote of Security Holders**

| a)   | Fixing                  the number of directors at seven (7) and election of the following                  nominees as directors, with votes “for” and “withheld,” as well as broker                  non-votes, as follows: |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **Director**                           | **Votes                  “For”** | **Votes                  “Withheld”** | **Broker                  Non-votes** |
|----------------------------------------|----------------------------------------------|---------------------------------------------------|---------------------------------------|
| Louis                  J. Akers        | 9,339,862                                    |                    30,038                    | -0-                                   |
| Philip                  E. Cline       | 9,283,615                                    |                    86,285                    | -0-                                   |
| Harley                  F. Mooney, Jr. | 9,286,937                                    |                    82,963                    | -0-                                   |
| A.                  Michael Perry      | 9,343,780                                    |                    26,120                    | -0-                                   |
| Marshall                  T. Reynolds  | 9,094,259                                    | 275,641                                           | -0-                                   |
| Neal                  W. Scaggs        | 9,318,537                                    |                    51,363                    | -0-                                   |
| Glenn                  W. Wilcox, Sr.  | 9,343,537                                    |                    26,363                    | -0-                                   |

**Item        6. Exhibits **

|         | a)                    Exhibits:                                                                                                                                                                                                                                            |   |                                                 |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------|
|         |                                                                                                                                                                                                                                                                       |   |                                                 |
| (10.1)  | $324,408                    term promissory note with commercial security agreement and business                    loan agreement between Champion Industries, Inc. and First Bank of                    Charleston, Inc. dated as of March 23, 2007  |   | Exhibit                    10.1 Page Exhibit 10.1-p1 |
|         |                                                                                                                                                                                                                                                                       |   |                                                 |
| (10.2)  |  $1,000,000                    revolving line of credit between Stationers, Inc. and First Sentry                    Bank                    dated as of April 7, 2007                                                                                                |   | Exhibit                    10.2 Page Exhibit 10.2-p1 |
|         |                                                                                                                                                                                                                                                                       |   |                                                 |
| (31.1)       | Principal                    Executive Officer Certification Pursuant to Section 302 of the                    Sarbanes-Oxley act of 2002 - Marshall T. Reynolds                                                                                                           |   | Exhibit                    31.1 Page Exhibit 31.1-p1 |
|         |                                                                                                                                                                                                                                                                       |   |                                                 |
| (31.2)       | Principal                    Financial Officer Certification Pursuant to Section 302 of the                    Sarbanes-Oxley act of 2002 - Todd R. Fry                                                                                                                    |   | Exhibit                    31.2 Page Exhibit 31.2-p1 |
|         |                                                                                                                                                                                                                                                                       |   |                                                 |
| (31.3)       | Principal                    Operating Officer Certification Pursuant to Section 302 of the                    Sarbanes-Oxley act of 2002 - Toney K. Adkins                                                                                                                |   | Exhibit                    31.3 Page Exhibit 31.3-p1 |
|         |                                                                                                                                                                                                                                                                       |   |                                                 |
| (32)         | Marshall                    T. Reynolds, Todd R. Fry and Toney K. Adkins Certification Pursuant                    to 18                    U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the                    Sarbanes-Oxley act of 2002                    |   | Exhibit                    32 Page Exhibit 32-p1     |

----

**Signatures**

| Date:                  June 8, 2007 | /s/                  Marshall T. Reynolds                                           |
|-------------------------------------|-------------------------------------------------------------------------------------|
|                                | Marshall                  T. Reynolds                                               |
|                                | Chief                  Executive Officer                                            |
|                                |                                                                                |
|                                |                                                                                |
| Date:                  June 8, 2007 | /s/                  Toney K. Adkins                                                |
|                                | Toney                  K. Adkins                                                    |
|                                | President                  and Chief Operating Officer                              |
|                                |                                                                                |
|                                |                                                                                |
| Date:                  June 8, 2007 | /s/                  Todd R. Fry                                                    |
|                                | Todd                  R. Fry                                                        |
|                                | Senior                  Vice President and Chief Financial                  Officer |

----