Sameer Borate has a recent post to his blog looking at a PHP_Thumb tool.

One of the frequent requirements in web design is that of thumbnail generation. Although there are many libraries out there I found PHP Thumb simple and quick enough to implement in a recent project. PHP Thumb is a light-weight image manipulation library aimed at thumbnail generation. It offers the ability to resize, create custom crops, or square crops from the center, and rotate the image. If the need arises you can also easily add custom functionality to the library through plugins.

Code examples are, of course, included in the post showing simple thumbnail creation, image rotation, cropping, resizing and outputting to a different format. There's a brief mention of custom plugins and the ability to chain functions.