Dec. 18--CPI Corp., which operates Sears and Wal-Mart Stores photo studios, reported a wider third-quarter loss and would not comment Thursday on why there was still no deal to renew its 10-year Sears contract that ends Dec. 31.

Shareholders had expected an announcement on a new pact this week, a belief that caused CPI's shares to quadruple last week. The company's shares were trading at $3.63, down $1.17 during early afternoon trading on the New York Stock Exchange.

"It's (contract renewal) much later than we all expected," SMH Capital analyst William Hamilton said during a Thursday teleconference with CPI. "I think most shareholders would like more of an explanation why we are at 12/18 here and we still don't have a contract. What is holding it up ... Is it getting closer?"

Dale Heins, chief financial officer, said he could not comment.

Hamilton had written a research report last week stating that concern about the contract had been depressing CPI's stock. Sears Portrait Studios should generate 54 percent of CPI's total sales in fiscal 2008, Hamilton wrote.

On Wednesday night, the company reported a third-quarter net loss of $13.3 million, or $2.06 per share, compared with a loss of $10.1 million, or $1.57 per share, a year ago. Revenues fell to $115.8 million from 135.4 million.

Sales at Sears Portrait Studio and PictureMe Portrait Studios that operate in Wal-Mart Stores fell 17 percent and 12 percent respectively.

gappleson@post-dispatch.com -- 314-340-8331

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