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| Delaware(State      or other jurisdiction of incorporation or organization) 1706      Washington Ave., St. Louis, Missouri(Address      of principal executive offices) | 43-1256674(I.R.S.      Employer Identification No.) 63103(Zip      Code) |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------|

| (Title of each      class)Common Stock $.40 Par      Value | (Name of each exchange on      which Registered)New York Stock      Exchange |
|------------------------------------------------------------|------------------------------------------------------------------------------|

| Note: | Checking      the box above will not relieve any registrant required to file reports      pursuant to Section 13 or 15(d) of the Exchange Act from their obligations      under those Sections. |
|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|               |   | Page                       |
|--------------------|--------|----------------------------|
|               |   |                       |
| PART      I.       |   | FINANCIAL      INFORMATION |   |   |
|               |   |                       |   |   |
|               |   | Item 1.                    |   | Financial      Statements: |   |   |
|               |   |                       |   |   |   |   |
|               |   |                       |   | Interim      Condensed Consolidated Balance Sheets |   |   |
|               |   |                       |   | April      26, 2008 (Unaudited) and February 2, 2008 |   | 1 |
|               |   |                       |   |   |   |   |
|               |   |                       |   | Interim      Condensed Consolidated Statements of Operation (Unaudited) |   |   |
|               |   |                       |   | 12      Weeks Ended April 26, 2008 and April 28, 2007 |   | 3 |
|               |   |                       |   |   |   |   |
|               |   |                       |   | Interim      Condensed Consolidated Statements of Changes in    Stockholders' |   |   |
|               |   |                       |   | Equity      (Unaudited) 12 Weeks Ended April 26, 2008 |   | 4 |
|               |   |                       |   |   |   |   |
|               |   |                       |   | Interim      Condensed Consolidated Statements of Cash Flow (Unaudited) |   |   |
|               |   |                       |   | 12      Weeks Ended April 26, 2008 and April 28, 2007 |   | 5 |
|               |   |                       |   |   |   |   |
|               |   |                       |   | Notes      to Interim Condensed Consolidated Financial Statements      (Unaudited) |   | 7 |
|               |   |                       |   |   |   |   |
|               |   | Item 2.                    |   | Management's      Discussions and Analysis of Financial Condition andResults |   |   |
|               |   |                       |   | of      Operations |   | 14 |
|               |   |                       |   |   |   |   |
|               |   | Item 3.                    |   | Quantitative      and Qualitative Disclosures about Market Risk |   | 20 |
|               |   |                       |   |   |   |   |
|               |   | Item 4.                    |   | Controls      and Procedures |   | 21 |
|               |   |                       |   |   |   |   |
| PART      II.      |   | OTHER      INFORMATION     |   |   |
|               |   |                       |   |   |
|               |   | Item      6.               |   | Exhibits |   | 22 |
|               |   |                       |
| SIGNATURES         |   |                       |   | 23 |
|               |   |                       |
| EXHIBIT      INDEX |   |                       |   | 24 |

Item 1

| thousands                                                                                           |   | April      26, 2008 |    |   | February      2, 2008 |   |
|-----------------------------------------------------------------------------------------------------|--------|---------------------|---------|--------|-----------------------|--------|
|                                                                                                |   | (Unaudited)         |    |   |                  |   |
| ASSETS                                                                                              |   |                |    |   |                  |   |
| Current      assets:                                                                                |   |                |    |   |                  |   |
|           Cash and cash equivalents                                             |   | $                   | 43,332  |   |                  | $      | 59,177 |   |
|           Restricted cash                                                       |   |                | -       |   |                  |   | - |   |
|              Accounts receivable:                                |   |                |    |   |                  |   |   |   |
|                  Trade                       |   |                | 7,743   |   |                  |   | 7,469 |   |
|                  Other                       |   |                | 2,091   |   |                  |   | 4,030 |   |
|           Inventories                                                           |   |                | 12,943  |   |                  |   | 14,296 |   |
|           Prepaid expenses and other current assets                             |   |                | 6,265   |   |                  |   | 5,174 |   |
|           Deferred tax assets                                                   |   |                | 2,349   |   |                  |   | 2,673 |   |
|                                                                                                |   |                |    |   |                  |   |   |   |
|           Total current assets                                                  |   |                | 74,723  |   |                  |   | 92,819 |   |
|                                                                                                |   |                |    |   |                  |   |   |   |
| Property      and equipment:                                                                        |   |                |    |   |                  |   |   |   |
|           Land                                                                  |   |                | 5,065   |   |                  |   | 5,065 |   |
|           Building improvements                                                 |   |                | 34,666  |   |                  |   | 34,666 |   |
|           Leasehold improvements                                                |   |                | 6,648   |   |                  |   | 5,426 |   |
|           Photographic, sales and manufacturing equipment                       |   |                | 175,588 |   |                  |   | 166,404 |   |
|              Total                                               |   |                | 221,967 |   |                  |   | 211,561 |   |
|           Less accumulated depreciation and amortization                        |   |                | 161,390 |   |                  |   | 155,281 |   |
|              Property and equipment, net                         |   |                | 60,577  |   |                  |   | 56,280 |   |
| Other      investments - supplemental retirement plan                                               |   |                | 3,494   |   |                  |   | 3,508 |   |
| Goodwill                                                                                            |   |                | 17,611  |   |                  |   | 18,049 |   |
| Intangible      assets, net of amortization of $3.5 million and $2.8 million at April 26,      2008 |   |                |    |   |                  |   |   |   |
|           and February 2, 2008, respectively                                    |   |                | 44,013  |   |                  |   | 44,907 |   |
| Deferred      tax assets                                                                            |   |                | 14,955  |   |                  |   | 14,439 |   |
| Other      assets                                                                                   |   |                | 6,627   |   |                  |   | 6,515 |   |
|                                                                                                |   |                |    |   |                  |   |   |   |
|           TOTAL ASSETS                                                          |   | $                   | 222,000 |   |                  | $      | 236,517 |   |
|                                                                                                |   |                |    |   |                  |   |   |   |
| See      accompanying footnotes                                                                     |   |                |    |   |                  |   |   |   |

| thousands,      except share and per share data                                                            |   | April      26, 2008 |     |   | February      2, 2008 |   |
|------------------------------------------------------------------------------------------------------------|--------|---------------------|----------|--------|-----------------------|--------|
|                                                                                                       |   | (Unaudited)         |     |   |                  |   |
| LIABILITIES                                                                                                |   |                |     |   |                  |   |
| Current      liabilities:                                                                                  |   |                |     |   |                  |   |
|           Current maturities of long-term debt                                         |   | $                   | 8,697    |   |                  | $      | 8,697 |   |
|           Accounts payable                                                             |   |                | 10,787   |   |                  |   | 14,369 |   |
|           Accrued employment costs                                                     |   |                | 9,661    |   |                  |   | 10,330 |   |
|           Customer deposit liability                                                   |   |                | 20,472   |   |                  |   | 21,255 |   |
|           Income taxes payable                                                         |   |                | 19       |   |                  |   | 387 |   |
|           Sales taxes payable                                                          |   |                | 3,103    |   |                  |   | 4,884 |   |
|           Accrued advertising expenses                                                 |   |                | 1,013    |   |                  |   | 1,266 |   |
|           Accrued expenses and other liabilities                                       |   |                | 17,475   |   |                  |   | 21,863 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
|           Total current liabilities                                                    |   |                | 71,227   |   |                  |   | 83,051 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
| Long-term      debt, less current maturities                                                               |   |                | 102,893  |   |                  |   | 103,022 |   |
| Accrued      pension plan obligations                                                                      |   |                | 10,204   |   |                  |   | 10,490 |   |
| Supplemental      retirement plan obligations                                                              |   |                | 3,465    |   |                  |   | 3,437 |   |
| Customer      deposit liability                                                                            |   |                | 22       |   |                  |   | 87 |   |
| Other      liabilities                                                                                     |   |                | 18,567   |   |                  |   | 19,456 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
|           Total liabilities                                                            |   |                | 206,378  |   |                  |   | 219,543 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
| STOCKHOLDERS'      EQUITY                                                                                  |   |                |     |   |                  |   |   |   |
| Preferred      stock, no par value, 1,000,000 shares authorized; no shares      outstanding                |   |                | -        |   |                  |   | - |   |
| Preferred      stock, Series A, no par value, 200,000 shares authorized; no      shares                    |   |                |     |   |                  |   |   |   |
|           outstanding                                                                  |   |                | -        |   |                  |   | - |   |
| Common      stock, $0.40 par value, 50,000,000 shares authorized; 17,055,153 and      17,028,315           |   |                |     |   |                  |   |   |   |
|           shares outstanding at April 26, 2008 and February 2, 2008,      respectively |   |                | 6,822    |   |                  |   | 6,811 |   |
| Additional      paid-in capital                                                                            |   |                | 27,729   |   |                  |   | 27,872 |   |
| Retained      earnings                                                                                     |   |                | 221,153  |   |                  |   | 222,435 |   |
| Accumulated      other comprehensive loss                                                                  |   |                | (7,213   | )      |                  |   | (6,725 | ) |
|                                                                                                       |   |                | 248,491  |   |                  |   | 250,393 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
| Treasury      stock - at cost, 10,595,319 and 10,619,728 at April 26, 2008      and                        |   |                |     |   |                  |   |   |   |
|           February 2, 2008, respectively                                               |   |                | (232,869 | )      |                  |   | (233,419 | ) |
|                                                                                                       |   |                |     |   |                  |   |   |   |
|           Total stockholders' equity                                                   |   |                | 15,622   |   |                  |   | 16,974 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
|           TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                   |   | $                   | 222,000  |   |                  | $      | 236,517 |   |
|                                                                                                       |   |                |     |   |                  |   |   |   |
| See      accompanying footnotes                                                                            |   |                |     |   |                  |   |   |   |

| thousands,      except share and per share data                                                           |   | 12      Weeks Ended |      |
|-----------------------------------------------------------------------------------------------------------|--------|---------------------|-----------|
|                                                                                                      |   | April      26, 2008 |      |   | April      28, 2007 |   |
| Net      sales                                                                                            |   | $                   | 103,443   |   |   | $ | 57,761 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Cost      and expenses:                                                                                   |   |                |      |   |   |   |   |   |
|           Cost of sales (exclusive of depreciation and amortization shown      below) |   |                | 10,492    |   |   |   | 5,018 |   |
|           Selling, general and administrative expenses                                |   |                | 83,910    |   |   |   | 45,231 |   |
|           Depreciation and amortization                                               |   |                | 7,512     |   |   |   | 3,413 |   |
|           Other charges and impairments                                               |   |                | 794       |   |   |   | 29 |   |
|                                                                                                      |   |                | 102,708   |   |   |   | 53,691 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Earnings      from operations                                                                             |   |                | 735       |   |   |   | 4,070 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Interest      expense                                                                                     |   |                | 1,521     |   |   |   | 414 |   |
| Interest      income                                                                                      |   |                | 362       |   |   |   | 306 |   |
| Other      income (expense), net                                                                          |   |                | 6         |   |   |   | (48 | ) |
|                                                                                                      |   |                |      |   |   |   |   |   |
| (Loss)      earnings before income tax (benefit) expense                                                  |   |                | (418      | ) |   |   | 3,914 |   |
| Income      tax (benefit) expense                                                                         |   |                | (162      | ) |   |   | 1,359 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| NET      (LOSS) EARNINGS                                                                                  |   | $                   | (256      | ) |   | $ | 2,555 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| NET      (LOSS) EARNINGS PER COMMON SHARE                                                                 |   |                |      |   |   |   |   |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Net      (loss) earnings per share - diluted                                                              |   | $                   | (0.04     | ) |   | $ | 0.40 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Net      (loss) earnings per share - basic                                                                |   | $                   | (0.04     | ) |   | $ | 0.40 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Dividends      per share                                                                                  |   | $                   | 0.16      |   |   | $ | 0.16 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Weighted      average number of common and common equivalent                                              |   |                |      |   |   |   |   |   |
|           shares outstanding - diluted                                                |   |                | 6,450,451 |   |   |   | 6,388,169 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| Weighted      average number of common and common equivalent                                              |   |                |      |   |   |   |   |   |
|           shares outstanding - basic                                                  |   |                | 6,450,451 |   |   |   | 6,363,445 |   |
|                                                                                                      |   |                |      |   |   |   |   |   |
| See      accompanying footnotes.                                                                          |   |                |      |   |   |   |   |   |

| thousands,      except share and per share data                 |   |   |   |   |       |   |   |     |   |   | Accumulated   |   |   |         |   |   |   |   |
|-----------------------------------------------------------------|--------|--------|--------|--------|------------|--------|--------|----------|--------|--------|---------------|--------|--------|--------------|--------|--------|--------|--------|
|                                                            |   |   |   |   | Additional |   |   |     |   |   | other         |   |   | Treasury     |   |   |   |   |
|                                                            |   | Common |   |   | paid-in    |   |   | Retained |   |   | comprehensive |   |   | stock,       |   |   |   |   |
|                                                            |   | stock  |   |   | capital    |   |   | earnings |   |   | loss          |   |   | at      cost |   |   | Total  |   |
|                                                            |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |
| Balance      at February 2, 2008                                |   | $      | 6,811  |   |       | $      | 27,872 |     |   | $      | 222,435       |   |   | $            | (6,725 | )      |   | $      | (233,419 | ) |   | $ | 16,974 |   |
|                                                            |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Net      loss                                                   |   |   | -      |   |       |   | -      |     |   |   | (256          | )      |   |         | -      |   |   |   | - |   |   |   | (256 | ) |
| Total      other comprehensive loss                             |   |   | -      |   |       |   | -      |     |   |   | -             |   |   |         | (488   | )      |   |   | - |   |   |   | (488 | ) |
|                                                            |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |
|         Total comprehensive loss                      |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   | (744 | ) |
| Surrender      of employee shares to satisfy personal tax       |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |
|          liabilities upon vesting (8,596 shares) |   |   | -      |   |       |   | -      |     |   |   | -             |   |   |         | -      |   |   |   | (175 | ) |   |   | (175 | ) |
| Issuance      of common stock to employee benefit plans and     |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |
|          restricted stock awards (59,843 shares) |   |   | 11     |   |       |   | (215   | )        |   |   | -             |   |   |         | -      |   |   |   | 725 |   |   |   | 521 |   |
| Stock-based      compensation recognized                        |   |   | -      |   |       |   | 72     |     |   |   | -             |   |   |         | -      |   |   |   | - |   |   |   | 72 |   |
| Dividends      ($0.16 per common share)                         |   |   | -      |   |       |   | -      |     |   |   | (1,026        | )      |   |         | -      |   |   |   | - |   |   |   | (1,026 | ) |
|                                                            |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Balance      at April 26, 2008                                  |   | $      | 6,822  |   |       | $      | 27,729 |     |   | $      | 221,153       |   |   | $            | (7,213 | )      |   | $      | (232,869 | ) |   | $ | 15,622 |   |
|                                                            |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| See      accompanying footnotes.                                |   |   |   |   |       |   |   |     |   |   |          |   |   |         |   |   |   |   |   |   |   |   |   |   |

| thousands                                                                       |   | 12      Weeks Ended |   |
|---------------------------------------------------------------------------------|--------|---------------------|--------|
|                                                                            |   | April      26, 2008 |   |   | April      28, 2007 |   |
|                                                                            |   |                |   |   |   |   |
| Reconciliation      of net (loss) earnings from operations to cash flows        |   |                |   |   |   |   |
| provided      by (used in) operating activities:                                |   |                |   |   |   |   |
|                                                                            |   |                |   |   |   |   |
| Net      (loss) earnings                                                        |   | $                   | (256   | ) |   | $ | 2,555 |   |
|                                                                            |   |                |   |   |   |   |   |   |
| Adjustments      for items not (providing) requiring cash:                      |   |                |   |   |   |   |   |   |
| Depreciation      and amortization                                              |   |                | 7,512  |   |   |   | 3,413 |   |
| Stock-based      compensation expense                                           |   |                | 72     |   |   |   | 88 |   |
| Loss      on disposition of property, plant and equipment                       |   |                | 166    |   |   |   | 10 |   |
| Loss      on sale of assets held for sale                                       |   |                | (4     | ) |   |   | 60 |   |
| Deferred      income tax provision                                              |   |                | (329   | ) |   |   | 1,033 |   |
| Pension,      supplemental retirement plan and profit sharing expense           |   |                | 758    |   |   |   | 792 |   |
| Other                                                                           |   |                | 158    |   |   |   | 84 |   |
|                                                                            |   |                |   |   |   |   |   |   |
| Increase      (decrease) in cash flow from operating assets and    liabilities: |   |                |   |   |   |   |   |   |
| Receivables      and inventories                                                |   |                | 3,306  |   |   |   | 208 |   |
| Prepaid      expenses and other current assets                                  |   |                | (1,132 | ) |   |   | 860 |   |
| Accounts      payable                                                           |   |                | (3,581 | ) |   |   | (224 | ) |
| Contribution      to pension plan                                               |   |                | (464   | ) |   |   |   |   |
| Supplemental      retirement plan payments                                      |   |                | (31    | ) |   |   | (52 | ) |
| Accrued      expenses and other liabilities                                     |   |                | (7,226 | ) |   |   | (3,766 | ) |
| Income      taxes payable                                                       |   |                | (362   | ) |   |   | 439 |   |
| Deferred      revenues and related costs                                        |   |                | (731   | ) |   |   | 323 |   |
| Other                                                                           |   |                | (850   | ) |   |   | (251 | ) |
|                                                                            |   |                |   |   |   |   |   |   |
| Cash      flows provided by (used in) operating activities                      |   | $                   | (2,994 | ) |   | $ | 5,572 |   |
|                                                                            |   |                |   |   |   |   |   |   |
| See      accompanying footnotes.                                                |   |                |   |   |   |   |   |   |

| thousands                                                                                            |   | 12      Weeks Ended |    |
|------------------------------------------------------------------------------------------------------|--------|---------------------|---------|
|                                                                                                 |   | April      26, 2008 |    |   | April      28, 2007 |   |
|                                                                                                 |   |                |    |   |   |   |
| Cash      flows provided by (used in) operating activities                                           |   | $                   | (2,994  | ) |   | $ | 5,572 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Cash      flows used in financing activities:                                                        |   |                |    |   |   |   |   |   |
| Repayment      of long-term debt                                                                     |   |                | (288    | ) |   |   | - |   |
| Surrender      of employee shares to satisfy personal tax liability upon      vesting                |   |                | (175    | ) |   |   | (547 | ) |
| Cash      dividends                                                                                  |   |                | (1,026  | ) |   |   | (1,015 | ) |
| Cash      flows used in financing activities                                                         |   |                | (1,489  | ) |   |   | (1,562 | ) |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Cash      flows (used in) provided by investing activities:                                          |   |                |    |   |   |   |   |   |
| Additions      to property and equipment                                                             |   |                | (11,299 | ) |   |   | (772 | ) |
| Proceeds      from sale of assets held for sale                                                      |   |                | 2       |   |   |   | 65 |   |
| Payments      related to the acquisition of certain                                                  |   |                |    |   |   |   |   |   |
|           net assets of Portrait Corporation of America, Inc.                    |   |                | (17     | ) |   |   | - |   |
| Increase      in assets held by Rabbi Trust                                                          |   |                | (20     | ) |   |   | (43 | ) |
| Proceeds      from Rabbi Trust used for supplemental retirement plan      payments                   |   |                | 34      |   |   |   | 50 |   |
| Cash      flows used in investing activities                                                         |   |                | (11,300 | ) |   |   | (700 | ) |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Effect      of exchange rate changes on cash and cash equivalents                                    |   |                | (62     | ) |   |   | 72 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Net      increase (decrease) in cash and cash equivalents                                            |   |                | (15,845 | ) |   |   | 3,382 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Cash      and cash equivalents at beginning of period                                                |   |                | 59,177  |   |   |   | 26,294 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Cash      and cash equivalents at end of period                                                      |   | $                   | 43,332  |   |   | $ | 29,676 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Supplemental      cash flow information:                                                             |   |                |    |   |   |   |   |   |
|           Interest paid                                                          |   | $                   | 1,846   |   |   | $ | 390 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
|           Income taxes paid                                                      |   | $                   | 471     |   |   | $ | 42 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| Supplemental      non-cash financing activities:                                                     |   |                |    |   |   |   |   |   |
|           Issuance of treasury stock under the employee Profit Sharing      Plan |   | $                   | 521     |   |   | $ | 442 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
|           Issuance of restricted stock to employees and directors                |   | $                   | 424     |   |   | $ | 1,647 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
|           Executive retirement stock option modification                         |   | $                   | -       |   |   | $ | 6 |   |
|                                                                                                 |   |                |    |   |   |   |   |   |
| See      accompanying footnotes.                                                                     |   |                |    |   |   |   |   |   |

| NOTE      1   - | DESCRIPTION      OF BUSINESS AND INTERIM CONDENSED CONSOLIDATED FINANCIAL      STATEMENTS |
|--------------------------------|-------------------------------------------------------------------------------------------|

| NOTE      2   - | ADOPTION      OF NEW ACCOUNTING STANDARDS |
|--------------------------------|-------------------------------------------|

|   | Level 1      - | Inputs were unadjusted, quoted prices in active markets      for identical assets or liabilities at the measurement  date. |
|--------|---------------------|----------------------------------------------------------------------------------------------------------------------------|

|   | Level      2 - | Inputs      (other than quoted prices included in Level 1) were either directly or      indirectly observable for the asset or liability through correlation with      market data at the measurement date and for the duration of the      instrument’s anticipated life. |
|--------|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Level      3 - | Inputs      reflected management’s best estimate of what market participants would use      in pricing the asset or liability at the measurement date. Consideration      was given to the risk inherent in the valuation technique and the risk      inherent in the inputs to themodel. |
|--------|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                            |   | Fair      Value Measurements |   |
|---------------------------------|--------|------------------------------|--------|
|                            |   | Level      1                 |   |   | Level      2 |   |   | Level      3 |   |   | Total |   |
| Assets                          |   |                         |   |   |   |   |   |   |   |   |   |   |
| Short-term      investments (1) |   | $                            | -      |   |   | $ | 29.6 |   |   | $ | - |   |   | $ | 29.6 |   |
| Interest      rate swaps (2)    |   |                         | -      |   |   |   | 2.3 |   |   |   | - |   |   |   | 2.3 |   |
| Liabilities                     |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      rate swaps (2)    |   | $                            | -      |   |   | $ | 31.9 |   |   | $ | - |   |   | $ | 31.9 |   |

| (1) | We      classified our marketable securities as cash, which is reported at fair      market value, using the “market approach” valuation technique, which uses      prices and other relevant information observable in market transactions      involving identical or comparable assets or  liabilities. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The      total fair value of the interest rate swaps were included in Other      Liabilities and Long-Term Debt as of April 26, 2008.  These      financial instruments were valued using the “income approach” valuation      technique.  This method used valuation techniques to convert      future amounts to a single present amount.  The measurement was      based on the value indicated by current market expectations about those      future amounts.  We used interest rate swaps as a means of      managing interest rates on our outstanding fixed-rate debt      obligations.  During the first quarter of 2007 a      $605,000 decrease in the fair value was recorded on the interest      rate swap, reducing interestexpense. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  NOTE 3   - | BUSINESS      ACQUISITION |
|--------------------------------------|---------------------------|

| Current      assets                 |   | $      | 10,247  |   |
|-------------------------------------|--------|--------|---------|--------|
| Property      and equipment         |   |   | 36,815  |   |
| Goodwill                            |   |   | 16,933  |   |
| Intangibles                         |   |   | 47,017  |   |
| Other      assets                   |   |   | 8,180   |   |
| Total      assets acquired          |   |   | 119,192 |   |
|                                |   |   |    |   |
| Current      liabilities assumed    |   |   | (26,773 | )      |
| Long-term      liabilities assumed  |   |   | (8,767  | )      |
|                                |   |   |    |   |
| Total      allocated purchase price |   | $      | 83,652  |   |
|                                |   |   |    |   |

|                               |   | First      Quarter |   |
|------------------------------------|--------|--------------------|--------|
|                               |   | 2008               |   |   | 2007 |   |
| Revenue                            |   | $                  | 95,243 |   |   | $ | 105,405 |   |
|                               |   |               |   |   |   |   |   |   |
| Net      loss                      |   | $                  | (2,346 | ) |   | $ | (5,972 | ) |
|                               |   |               |   |   |   |   |   |   |
| Basic      loss per common share   |   |               | (0.36  | ) |   |   | (0.94 | ) |
|                               |   |               |   |   |   |   |   |   |
| Diluted      loss per common share |   |               | (0.36  | ) |   |   | (0.94 | ) |

| NOTE      4   - | INVENTORIES |
|--------------------------------|-------------|

| thousands                                |   | April      26, 2008                                                                                                                           |   | February      2, 2008                                                                                                                         |
|------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|
|                                     |   |                                                                                                                                          |   |                                                                                                                                          |
| Raw      materials - paper and chemicals |   |  $                 3,917                            |   |  $                 4,902                            |
| Portraits      in process                |   |                     2,159                 |   |                     2,244                 |
| Finished      portraits pending delivery |   |                        854 |   |                     1,187                 |
| Frames      and accessories              |   |                        523 |   |                        634 |
| Studio      supplies                     |   |                     3,547                 |   |                     3,636                 |
| Equipment      repair parts and supplies |   |                     1,261                 |   |                     1,246                 |
| Other                                    |   |                        682 |   |                        447 |
|                                     |   |                                                                                                                                          |   |                                                                                                                                          |
| Total                                    |   |  $               12,943                                       |   |  $               14,296                                       |
|                                     |   |                                                                                                                                          |   |                                                                                                                                          |

|  NOTE 5   - | GOODWILL      AND INTANGIBLE ASSETS |
|--------------------------------------|-------------------------------------|

|                                        |   | April      26, 2008 |   |   | February      2, 2008 |   |
|---------------------------------------------|--------|---------------------|--------|--------|-----------------------|--------|
|                                        |   |                |   |   |                  |   |
| PCA      acquisition                        |   | $                   | 16,933 |   |                  | $      | 17,338 |   |
|                                        |   |                |   |   |                  |   |   |   |
| Goodwill      from prior acquisitions       |   |                | 512    |   |                  |   | 512 |   |
|                                        |   |                |   |   |                  |   |   |   |
| Translation      impact on foreign balances |   |                | 166    |   |                  |   | 199 |   |
|                                        |   | $                   | 17,611 |   |                  | $      | 18,049 |   |
|                                        |   |                |   |   |                  |   |   |   |

|                         |   |   |   |   |         |   |   | Translation    |   |   |    |   |
|------------------------------|--------|--------|--------|--------|--------------|--------|--------|----------------|--------|--------|---------|--------|
|                         |   |   |   |   |         |   |   | Impact      of |   |   |    |   |
|                         |   | Gross  |   |   | Accumulated  |   |   | Foreign        |   |   | Net     |   |
|                         |   | Amount |   |   | Amortization |   |   | Balances       |   |   | Balance |   |
|                         |   |   |   |   |         |   |   |           |   |   |    |   |
| Acquired      host agreement |   | $      | 43,982 |   |         | $      | (1,838 | )              |   | $      | 425     |   |   | $ | 42,569 |   |
| Acquired      customer list  |   |   | 3,035  |   |         |   | (1,624 | )              |   |   | 33      |   |   |   | 1,444 |   |
|                         |   | $      | 47,017 |   |         | $      | (3,462 | )              |   | $      | 458     |   |   | $ | 44,013 |   |
|                         |   |   |   |   |         |   |   |           |   |   |    |   |   |   |   |   |

| NOTE 6   - | OTHER      ASSETS AND OTHER LIABILITIES |
|--------------------------------|-----------------------------------------|

| NOTE      7   - | STOCK-BASED      COMPENSATION PLANS |
|--------------------------------|-------------------------------------|

|                                           |                |   | Options      Outstanding and Exercisable |      |
|------------------------------------------------|---------------------|--------|------------------------------------------|-----------|
|                                           |                |   |                                     |      |   | Weighted-Average |   |   |   |   |
|                                           |                |   |                                     |      |   | Remaining      Contractual |   |   | Weighted-Average |   |
| Range      of Exercise Prices                  |                |   | Shares                                   |      |   | Life      (Years) |   |   | Exercise      Price |   |
| $                                              | 12.96               |   |                                     |      | 10,046 |   |   |   | 2.49 |   |   | $ | 12.96 |   |
| $                                              | 16.50      - $17.00 |   |                                     |      | 25,000 |   |   |   | 1.95 |   |   |   | 16.60 |   |
|                                           |                |   |                                     |      |   |   |   |   |   |   |   |   |   |   |
| Total                                          |                |   |                                     | 35,046    |   |   |   | 2.11 |   |   |   | 15.56 |   |
|                                           |                |   |                                     |      |   |   |   |   |   |   |   |   |   |   |
| Reserved      for future grants at quarter-end |                |   |                                     | 1,020,639 |   |   |   |   |   |   |   |   |   |
| Exercisable                                    |                |   |                                     | 35,046    |   |   |   |   |   |   |   |   |   |

|                                           |   | Quarter      Ended April 26, 2008 |    |
|------------------------------------------------|--------|-----------------------------------|---------|
|                                           |   |                              |    |   | Weighted-Average |   |
|                                           |   | Shares                            |    |   | Grant-date      Value |   |
| Nonvested      stock, beginning of year        |   |                              | 1,584   |   |   | $ | 18.95 |   |
| Granted                                        |   |                              | 28,309  |   |   |   | 15.80 |   |
| Forfeited                                      |   |                              | (1,471  | ) |   |   | 15.80 |   |
| Nonvested      stock, end of quarter           |   |                              | 28,422  |   |   |   |   |   |
|                                           |   |                              |    |   |   |   |   |   |
| Reserved      for future grants at quarter-end |   |                              | 161,099 |   |   |   |   |   |
| Stock-based      compensation expense related  |   |                              |    |   |   |   |   |   |
| to      restricted stock                       |   | $                                 | 71,521  |   |   |   |   |   |
|                                           |   |                              |    |   |   |   |   |   |

| NOTE      8   - | EMPLOYEE      BENEFIT PLANS |
|--------------------------------|-----------------------------|

| thousands                                      |   | Pension      Plan   |   |   | Supplemental      Retirement Plan |   |
|------------------------------------------------|--------|---------------------|--------|--------|-----------------------------------|--------|
|                                           |   | 12      Weeks Ended |   |   | 12      Weeks Ended               |   |
|                                           |   | April      26, 2008 |   |   | April      28, 2007               |   |   | April      26, 2008 |   |   | April      28, 2007 |   |
| Components      of net periodic benefit costs: |   |                |   |   |                              |   |   |   |   |   |   |   |
| Service      cost                              |   | $                   | 62     |   |                              | $      | 75 |   |   | $ | 16 |   |   | $ | 18 |   |
| Interest      cost                             |   |                | 691    |   |                              |   | 675 |   |   |   | 49 |   |   |   | 48 |   |
| Expected      return on plan assets            |   |                | (746   | )      |                              |   | (679 | ) |   |   | - |   |   |   | - |   |
| Amortization      of prior service cost        |   |                | 10     |   |                              |   | 10 |   |   |   | 7 |   |   |   | 7 |   |
| Amortization      of net (gain) loss           |   |                | 161    |   |                              |   | 205 |   |   |   | (14 | ) |   |   | (8 | ) |
|                                           |   |                |   |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Net      periodic benefit cost                 |   | $                   | 178    |   |                              | $      | 286 |   |   | $ | 58 |   |   | $ | 65 |   |
|                                           |   |                |   |   |                              |   |   |   |   |   |   |   |   |   |   |   |

| NOTE      9   - | INCOME      TAXES |
|--------------------------------|-------------------|

| ● | Unrecognized      tax benefits were approximately $2.7 million at each of April 26, 2008 and      February 2, 2008.  If these unrecognized tax benefits were      recognized, approximately $2.7 million would impact the effective tax      rate.  It is not expected that the amount of unrecognized tax      benefits will change in the next 12 months.                   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ● | The      Company recognizes interest expense and penalties related to the      above-unrecognized tax benefits within income tax expense.  Due      to the nature of the unrecognized tax benefits, the Company had no accrued      interest and penalties as of April 26, 2008 or February 2,      2008.                                                                               |
| ● | The      Company and its subsidiaries file income tax returns in the U.S. federal      jurisdiction, many states, Mexican and Canadian      jurisdictions.  The Company is no longer subject to U.S. Federal      income tax examination for the years prior to      2003.   Ongoing examinations by various state taxing      authorities date back to February 1,2003. |

| NOTE      10   - | CONTINGENCIES |
|---------------------------------|---------------|

Item2.                 Management’sDiscussion and Analysis of Financial Condition and Results ofOperations

|                                               |   | April      26, 2008 |   |   | April      28, 2007 |   |
|----------------------------------------------------|--------|---------------------|--------|--------|---------------------|--------|
| Within      Sears or Sears Grand Stores:           |   |                |   |   |                |   |
| United      States and Puerto Rico                 |   |                | 891    |   |                |   | 894 |   |
| Canada                                             |   |                | 112    |   |                |   | 112 |   |
|                                               |   |                |   |   |                |   |   |   |
| Within      Wal-Mart Stores:                       |   |                |   |   |                |   |   |   |
| United      States and Puerto Rico                 |   |                | 1,702  |   |                |   | 0 |   |
| Canada                                             |   |                | 253    |   |                |   | 0 |   |
| Mexico                                             |   |                | 115    |   |                |   | 0 |   |
|                                               |   |                |   |   |                |   |   |   |
| Locations      not within Sears or Wal-Mart stores |   |                | 32     |   |                |   | 34 |   |
|                                               |   |                |   |   |                |   |   |   |
| Total                                              |   |                | 3,105  |   |                |   | 1,040 |   |
|                                               |   |                |   |   |                |   |   |   |

| thousands,      except per share data                                            |   | 12      Weeks Ended |    |
|----------------------------------------------------------------------------------|--------|---------------------|---------|
|                                                                             |   | April      26, 2008 |    |   | April      28, 2007 |   |
|                                                                             |   |                |    |   |   |   |
| Net      sales                                                                   |   | $                   | 103,443 |   |   | $ | 57,761 |   |
|                                                                             |   |                |    |   |   |   |   |   |
| Cost      and expenses:                                                          |   |                |    |   |   |   |   |   |
| Cost      of sales (exclusive of depreciation and amortization shown      below) |   |                | 10,492  |   |   |   | 5,018 |   |
| Selling,      general and administrative expenses                                |   |                | 83,910  |   |   |   | 45,231 |   |
| Depreciation      and amortization                                               |   |                | 7,512   |   |   |   | 3,413 |   |
| Other      charges and impairments                                               |   |                | 794     |   |   |   | 29 |   |
|                                                                             |   |                | 102,708 |   |   |   | 53,691 |   |
| Earnings      from operations                                                    |   |                | 735     |   |   |   | 4,070 |   |
|                                                                             |   |                |    |   |   |   |   |   |
| Interest      expense                                                            |   |                | 1,521   |   |   |   | 414 |   |
| Interest      income                                                             |   |                | 362     |   |   |   | 306 |   |
| Other      income (expense), net                                                 |   |                | 6       |   |   |   | (48 | ) |
|                                                                             |   |                |    |   |   |   |   |   |
| (Loss)      earnings before income tax (benefit) expense                         |   |                | (418    | ) |   |   | 3,914 |   |
| Income      tax (benefit) expense                                                |   |                | (162    | ) |   |   | 1,359 |   |
|                                                                             |   |                |    |   |   |   |   |   |
| NET      (LOSS) EARNINGS                                                         |   | $                   | (256    | ) |   | $ | 2,555 |   |
| Net      (loss) earnings per share - diluted                                     |   | $                   | (0.04   | ) |   | $ | 0.40 |   |
|                                                                             |   |                |    |   |   |   |   |   |

| ● | Net      sales for the first quarter of 2008 increased $45.6 million or 79.1% to $      103.4 million from the $57.8 million reported in the first quarter of 2007      as a result of the inclusion of net sales of $50.3 million attributable to      the Company’s PMPS brand. |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Cost      of sales, excluding depreciation and amortization expense, was $10.5      million in the first quarter of 2008 compared with $5.0 million in the      comparable prior year period.   The increase in cost of      sales is attributable to the inclusion of PMPS cost of sales in the      first quarter of 2008, partially offset by decreased production costs      resulting from lower overall manufacturing production levels,      additional gains in manufacturing productivity and an improved      product mix. |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Depreciation      and amortization was $7.5 million in the first quarter of 2008, compared      to $3.4 million in the comparable quarter of 2007.  This      increase is attributable to the inclusion in the first quarter of 2008 of      depreciation and amortization related to the PMPS brand and includes      $664,000 of amortization of intangible assets resulting from the PMPS      acquisition. |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Other      charges and impairments reflect costs incurred from strategic actions      implemented by the Company to restructure its operations, costs that are      unpredictable and atypical of the Company’s operations and additional      charges due to asset impairments.  In the first quarter of 2008      and 2007, the Company recognized $794,000 and $29,000, respectively, in      other charges and impairments.  Expense in 2008 primarily      represents costs associated with the PMPS Acquisition, which include      severance costs, severance accruals and other integration-related costs      relative to thePMPS Acquisition. |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Interest      expense was $1.5 million in the first quarter of 2008 compared to $414,000      in the comparable period of the prior year.  The increase in      interest expense is primarily the result of higher average borrowings      after the refinancing of the credit agreement as discussed in Note 7 as      well as slightly higher interest rates and increased fees for letters of      credit.  This was partially offset by an adjustment to the      fair value of an interest rate swap agreement decreased interest      expense by $605,000. |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Interest      income was $362,000 in the first quarter of 2008 compared to $306,000 in      the first quarter of 2007.  This increase is primarily      attributable to higher invested balances in 2008 as compared to 2007, the      result of higher net receipts due to the PCA acquisition of June      2007. |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Income      tax benefit was $162,000 in the first quarter of 2008 as compared to $1.4      million expense in the first quarter of 2007.  The resulting      effective tax rates were 38.7% in 2008 and 34.7% in 2007.  The      increase in the effective tax rate in 2008 is attributable to the fact      that 2007 experienced higher Federal employment tax credits as a result of      the PCA Acqusition. |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Other      income was $6,000 in the first quarter of 2008 as compared to an expense      of $48,000 in comparable prior yearquarter. |
|---------|--------------------------------------------------------------------------------------------------------------------------------------|

| thousands                                    |   | 12      Weeks Ended |    |
|----------------------------------------------|--------|---------------------|---------|
|                                         |   | April      26, 2008 |    |   | April      28, 2007 |   |
| Net      cash (used in) provided by:         |   |                |    |   |   |   |
| Operating      activities                    |   | $                   | (2,994  | ) |   | $ | 5,572 |   |
| Financing      activities                    |   |                | (1,489  | ) |   |   | (1,562 | ) |
| Investing      activities                    |   |                | (11,300 | ) |   |   | (700 | ) |
| Effect      of exchange rate changes on cash |   |                | (62     | ) |   |   | 72 |   |
|                                         |   |                |    |   |   |   |   |   |
| Net      increase (decrease) in cash         |   | $                   | (15,845 | ) |   | $ | 3,382 |   |
|                                         |   |                |    |   |   |   |   |   |

Item3.

| Notional      amount        |   | $                       | 57,500,000 |   |
|-----------------------------|--------|-------------------------|------------|--------|
|                        |   |                    |       |   |
| Fixed      rate paid        |   |                    | 4.97       | %      |
|                        |   |                    |       |   |
| Variable      rate received |   |                    | 5.69       | %      |
|                        |   |                    |       |   |
| Effective      date         |   | September      17, 2007 |       |
|                        |   |                    |       |   |
| Expiration      date        |   | September      17, 2010 |       |

Item4.                      Controlsand Procedures

| ● | Implementing      effective controls over tax depreciation amounts, which include the timely      resolution of reconciling items between the Company’s tax returns, the      Company’s tax depreciation records, and the calculations of deferred taxes      and income tax expense. |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Establishing      management monitoring controls to ensure those reconciliation controls are      designed and operating effectively. |
|---------|---------------------------------------------------------------------------------------------------------------------------------------|

| ● | Establishing      policies and procedures to ensure the fair value of the interest rate swap      is properly determined andrecorded. |
|---------|---------------------------------------------------------------------------------------------------------------------------------------|

| ● | Establishing      management monitoring controls to policies and procedures over determining      and recording of the interest rate swap is designed and operating      effectively. |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Establishing      policies and procedures to ensure the accrual for unpaid advertising costs      is properly determined andrecorded. |
|---------|---------------------------------------------------------------------------------------------------------------------------------------|

| ● | Establishing      management monitoring controls for policies and procedures over the      determination and recording of the advertising accrual to ensure controls      are designed and operatingeffectively. |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

PART II

|   | CPI CORP.(Registrant) |                                                      |
|--------|-----------------------|-----------------------------------------------------------|
|   |                  |                                                      |   |
|   | By:                   | /s/Dale      Heins                                        |   |
|   |                  | Dale      Heins                                           |   |
|   |                  | Senior      Vice President, Finance and                   |   |
|   |                  | Chief      Financial Officer(Principal Financial Officer) |   |

|   |   |                                      |
|--------|--------|-------------------------------------------|
|   |   |                                      |   |
|   | By:    | /s/Rose      O'Brien                      |   |
|   |   | Rose      O'Brien                         |   |
|   |   | Vice      President, Corporate Controller |   |
|   |   | (Principal      Accounting Officer)       |   |

EXHIBIT INDEX

| 11.1   |   | Computation      of Per Share (Loss) Earnings - Diluted - for the 12 weeks ended April 26,      2008 and April 28, 2007.         |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                             |
| 11.2   |   | Computation      of Per Share (Loss) Earnings - Basic - for the 12 weeks ended April 26,      2008 and April 28, 2007.           |
|   |   |                                                                                                                             |
| 31.1   |   | Certification      Pursuant to Rule 13a-14(a) Under the Securities and Exchange Act of 1934      by the Chief Executive Officer. |
|   |   |                                                                                                                             |
| 31.2   |   | Certification      Pursuant to Rule 13a-14(a) Under the Securities and Exchange Act of 1934      by the Chief Financial Officer. |
|   |   |                                                                                                                             |
| 32.0   |   | Certification      Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of      the Sarbanes-Oxley Act         |
|   |   | of      2002 by the Chief Executive Officer and the Chief Financial      Officer.                                                |