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Timber Lodge Steakhouse, Inc. Business Information, Profile, and History

1801 E. 79th St., Suite 27
Bloomington, Minnesota 55425
U.S.A.

Company Perspectives:

Timber Lodge Steakhouse, Inc. develops, owns and operates Timber Lodge Steakhouses. These are full-service, casual restaurants serving dinners of generous portions at moderate prices and featuring a "northwoods" atmosphere. The menu features steaks, prime rib, barbequed ribs, fresh seafood, chicken, pasta and specialty regional entrees and appetizers.

History of Timber Lodge Steakhouse, Inc.

Timber Lodge Steakhouse, Inc. is a chain of steakhouse restaurants known for its northwoods lodge-like décor and its moderately priced menu. The company operates 24 Timber Lodge restaurants covering seven different markets in Minnesota, Wisconsin, Illinois, South Dakota, Nebraska, North Dakota, and New York. Food choices include steak, chicken, pork, seafood, and a variety of accompaniments. The restaurants also feature wine and spirits and a lengthy list of appetizers.

The company was once publicly traded on the NASDAQ but in successive buyouts Timber Lodge went private when a group of former management signed a deal to buy the company. CEO and President Peter Bedzyk owns the majority of stock, holding 45 percent in 2005.

Minnesota Steakhouse

In 1991, when two St. Louis Park, Minnesota, partners formed Q-Steaks Incorporated, the restaurant business in the Midwest was characterized by small town supper clubs and meat and potato fare. Unlike many other parts of the country where national and regional chain restaurants were taking root all over the place, the Midwest market was just opening up to chain restaurants. Several non-fast food thematic establishments had only just successfully entered the local landscape.

Minnesota restaurateurs Doren Jensen and Dermot F. Rowland took note of the regional carnivorous diet and began a chain of steakhouses, naming the establishments The Minnesota Steakhouse. The two settled on a cabin-like northwoods theme for The Minnesota Steakhouse. The restaurant atmosphere guaranteed the relaxation of an up-North cabin with its roaring fire and log timbers, an atmosphere many Midwesterners longed for. The company was to change its name, ownership, and management over its lifetime but the one constant would be its emphasis on meat, particularly red meat and its generous Midwestern portion size.

When the chain opened two Buffalo, New York, restaurants in 1994, Q-Steaks decided to drop the Minnesota reference and name those operations after Minnesota legend Paul Bunyan. The company introduced P. Bunyan's Steakhouse to the Niagara Falls area, an important tourist destination and an expanding restaurant market.

In 1993 Q-Steak went public and company shares were listed on the NASDAQ. The company needed investment for expansion, and thus had turned to an initial public offering (IPO) to secure that funding. In 1995 the company sought to rename its six restaurant establishments Timber Lodge Steakhouse. Shareholders of the company's stock granted permission for the name change in the early summer of 1995. The company issued a statement to the press explaining the reason for the name change saying, "This is intended to raise consumer awareness of [the restaurant chain's] distinctive style and to increase name recognition throughout the company's current and potential market area." Timber Lodge opened in Sioux Falls, South Dakota, at this time and the company closed its restaurant in Williamsville, New York. Timber Lodge management cited problems with the strip mall location in Williamsville as its reason for the closure.

By August 1996 Timber Lodge opened its 12th restaurant, and had rebounded from some losses it had incurred as a result of its name change and the confusion it created with its customers. Timber Lodge won the Minnesota Beef Council Beef Backer Award that same year, a prize it was awarded for selling approximately $17 million in steaks during its calendar year.

In the early weeks of 1997, Timber Lodge benefited from a surge of investor interest in the company. Analysts had marked Timber Lodge stock as a good buy and it had jumped in a three-week period from $3.50 to $5.12 per share. In May 1997 Timber Lodge opened its 14th steakhouse. The company chose St. Cloud, Minnesota, for its 240-seat dining facility.

The 1990s Buyout and Expansion

In December 1997 G.B. Foods Corporation (GBFC) announced that it intended to acquire all the outstanding shares of capital stock, taking over the company. GBFC, based in California, owned and operated or franchised 185 Green Burrito quick-service Mexican restaurants. Its chairman, William Foley II, also was chairman of CKE Restaurants, which owned the Hardee's and Carl's Jr. fast-food chains. GBFC planned to take Timber Lodge west to Arizona, Utah, Idaho, and New Mexico. The $32.4 million acquisition allowed for an influx of capital needed to expand the restaurant into new markets.

Timber Lodge reported strong fourth quarter earnings in 1997, up 33 percent over the same period the prior year. While net income had increased, expenditures at the company had also increased. Timber Lodge reported costs up 5.2 percent in 1997. The company blamed the higher expenses on increased advertising, leases, and short-term borrowing.

The acquisition was finalized in January 1998, with Timber Lodge shareholders receiving 0.8 shares of GBFC common stock for each Timber Lodge share. GBFC made public its plan to convert 16 JB's Restaurants into Timber Lodges over the next several years. JB's Restaurants was a wholly owned subsidiary of CKE Restaurants Inc.

In February 1998 CKE announced its plan to sell GBFC JB's Restaurants for one million shares of GBFC common stock. At the close of the deal GBFC became Santa Barbara Restaurant Group (SBRG)

By July 1998, Timber Lodge had added its 18th location. The restaurant was the first Timber Lodge Steakhouse to open in Rochester, Minnesota. Timber Lodge parent company GBFC signed a letter of intent in August 1998 with Franchise Finance Corporation of America for financing properties the company hoped to buy. The strategic alliance allowed GBFC to expand its new concept restaurants without raising capital for the projects.

Timber Lodge Steakhouse began airing a new advertising campaign in October 1998. The company hired Cevette and Company of Minneapolis to produce the spot, which featured an ambulance rushing a hungry patient to one of its restaurants. The concept was hailed as unusual because the advertisement did not feature any food items, only the suggestion to head to Timber Lodge when one was really hungry.

The company opened its ninth Twin Cities location in November 1999, a Timber Lodge Steakhouse in the Southtown Shopping center in Bloomington, Minnesota. The company continued its rapid growth with the addition of two more Twin Cities steakhouses the following year, one in Maple Grove and another in Stillwater, Minnesota. Timber Lodge ventured into North Dakota by opening a restaurant in Fargo towards the end of 2000.

The company opened several converted JB's Restaurants to Timber Lodges in the Salt Lake City area and Phoenix and Tucson, Arizona, which brought its number of steakhouses to 23 by June 2000.

In March 2000, Santa Barbara Restaurant Group, Inc., agreed to sell the remainder of its JB's Family Restaurants to the chief operating officer of the restaurant chain. The deal included 52 company operated establishments and 29 franchised facilities. SBRG also agreed to sell its six Galaxy Diners. A number of JB's Family Restaurants had already been converted to Timber Lodge Steakhouses in Arizona and Utah and those six restaurants were not included in the sale.

Sales declined for the company in the first and second quarters of 2001. Revenue was down by 1.1 percent in the first quarter compared to an increase of 8 percent the previous year, and second quarter results showed even further decline, with a loss of 5.8 percent, compared to an increase of 2.8 percent the same quarter in 2000.

SBRG President and CEO Andrew Puzder spoke regarding the disappointing trend when the company announced its earnings report through PR Newswire: "Regarding Timber Lodge Steakhouse, I am certainly disappointed with the negative sales trends, and we are working very hard to reverse them. Fortunately, in spite of the soft sales, we have been able to improve operating margins at Timber Lodge, which positions us very well to capitalize on any future sales improvement."

News of a buyout of SBRG by closely related CKE Restaurant Group surfaced in November 2001. CKE announced its intent to purchase SBRG despite its own struggles with debt mostly incurred by its holding of Hardee's. Hardee's was purchased by CKE in 1998 for more than $750 million, but the chain was poorly managed and in need of a turnaround.

The sluggish American economy took its toll on restaurants throughout the years 2001 and 2002. Still, according to a Minneapolis Star Tribune article, consumers seeking the convenience of ready-made meals were still buying food on the go. In 2000, according to the Star Tribune, "the restaurant industry took in 45 percent of all dollars spent on food."

The web site Beef.org reported that 3.8 percent of American households visited a steakhouse in an average two-week period, and steakhouses continued to be one of the fastest-growing areas in foodservice. The site claimed that from 1993 to 2000 consumer expenditures at casual steakhouses increased 150 percent.

Timber Lodge parent company CKE signed a beverage deal with Coca-Cola Fountain in January 2003. Coca-Cola provided all Timber Lodge Steakhouses with soft drinks and bottled water.

Low carbohydrate diets became the craze of the new decade and the push for protein was only countered by the fear that shocked the nation when a possible positive report of bovine, spongiform encephalopathy was reported in an adult Holstein cow in Washington state. The report was the first confirmed case of mad cow disease in the United States. CKE issued statements in December 2003 that none of its suppliers purchased meat from the implicated Washington beef packer.

2000 and Beyond: Back in Private Hands

In September 2004 CKE Restaurants sold its Timber Lodge holdings to T. Lodge Acquisition, a privately held group of former management and other investors. The deal was for approximately $8.8 million, with $7 million in cash and $1.8 million in secured notes.

The menu at Timber Lodge was recreated in February 2004. Although the standard entrees remained, Executive Chef Tim Ristow received some assistance from Corporate Chef Scott Foster to tweak the offerings and raise the bar a notch. The company included extra features listed as Timber Toppers that were added to traditional entrees for a minimal extra charge. The toppers allowed patrons to custom order a meat or fish entree with specialty crusting or additional sauces and rubs.

The company hired Medvec-Eppers Advertising in the spring of 2004 to produce radio spots promoting the restaurant. The campaign featured local Twin Cities talent, including Mick Sterling and the Stud Brothers and Jack Knife and the Sharps. Another campaign, featuring Minnesota Vikings Head Coach Mike Tice, was aired throughout the Twin Cities radio market and brought a great deal of publicity to the company.

The American diet, despite the diversity of its culture, was a diet committed to the consumption of meat products. The Midwest restaurant market catered to the demand for quality affordable steaks and Timber Lodge Steakhouse was poised to meet the growing needs of a public eager for prepared foods, creating a warm, homey retreat atmosphere and affordable prices.

Principal Competitors: American Restaurant Group, Inc.; Landry's Restaurants, Inc.; Outback Steakhouse, Inc.

Related information about Timber

:For the musical term timbre, see timbre.

Timber is a term used to describe wood, either standing or that has been processed for use—from the time trees are felled, to its end product as a material suitable for industrial use—as structural material for construction or wood pulp for paper production. In the U.K. and Australia, "timber" is a term also used for sawn wood products (that is, boards), whereas generally in the United States and Canada, the product of timber cut into boards is referred to as lumber. Rough lumber is the raw material for furniture making and other items requiring additional cutting and shaping. It is available in many species, usually hardwoods. Finished lumber is supplied in standard sizes, mostly for the construction industry, and is primarily one of a few coniferous (needle-bearing) species such as pine, cedar, hemlock, fir or spruce. Maine and New York were early leading producers; however, later expansion led to Michigan and later Oregon, Washington, and California assuming the lead in domestic lumber production. Logging, the felling and preparation of trees for lumber was a related frontier industry; various tales of lumberjacks were a substantial portion of a certain chapter in North American folklore.

Classifications

Rough lumber comes from the sawmill without further cutting or shaping. It is usually sold in random lengths and widths and measured in the USA and Canada in board feet, a unit of 1 foot × 1 inch × 1 foot. It is available air-dried or kiln-dried. It is then ready to be used for furniture-making or other woodworking uses.

Finished lumber is usually kiln-dried, then planed and cut to predetermined sizes, primarily for use by the construction industry. When using Imperial or U.S. customary measurements, the widths given are from before planing, whereas the piece actually sold is smaller; When using metric measurements, lumber is measured in actual sizes.

In the United States, timber is cut in the forest in 24 foot lengths. At the mill it is again cut into three 8 foot lengths, an 8 foot and a 16 foot length, a 10 foot and a 14 foot length or two 12 foot lengths.

Lumber is also used to refer to plywood and other composite wood products.

Dimensional Lumber

Dimensional lumber is a term used in North America for lumber that is finished/planed and cut to standardized width and depth specified in inches.

Softwoods

Softwood Dimensional Lumber Sizes

Nominal

Actual

Nominal

Actual

1 × 2

¾? (19×38 mm)

2 × 2

1½? (38×38 mm)

1 × 3

¾? (19×64 mm)

2 × 3

1½? (38×64 mm)

1 × 4

¾? (19×89 mm)

2 × 4

1½? (38×89 mm)

1 × 6

¾? (19×140 mm)

2 × 6

1½? (38×140 mm)

1 × 8

¾? (19×184 mm)

2 × 8

1½? (38×184 mm)

1 × 10

¾? (19×235 mm)

2 × 10

1½? (38×235 mm)

1 × 12

¾? (19×286 mm)

2 × 12

1½? (38×286 mm)

3 × 4

2½? (64×89 mm)

2 × 14

1½? (38×337 mm)

4 × 4

3½? (89×89 mm)

6 × 6

5½? (140×140 mm)

4 × 6

3½? In the United States the standard lengths of lumber are 6, 8, 10, 12, 14, 16, 18, 20, 22, and 24 feet.

Solid dimensional lumber typically is only available up to lengths of 24', yet since builders have a need for lengths beyond that for roof construction (rafters), builders use "finger-jointed" lumber that can be up to 36' long in 2x6 size (see Engineered Lumber below). Pre-cut studs save a framer a lot of time as they are pre-cut by the manufacturer to be used in 8', 9' & 10' ceiling applications, which means they have removed a few inches of the piece to allow for the sill plate and the double top plate with no additional sizing necessary by the framer.

In The Americas, two-bys (2×4s, 2×6s, 2×8s, 2x10s, and 2×12s) are common lumber sizes used in modern construction. They are the basic building block for such common structures as balloon-frame or platform-frame housing. Dimensional lumber made from softwood is typically used for construction, while hardwood boards are more commonly used for making cabinets or furniture.

The nominal size of a board varies from the actual size of the board. This is due to planing and shrinkage as the board is dried. As the wood dries, it shrinks and reaches the specified actual dimensions.

Non-North American sizes

Examples of Dimensional Lumber Sizes (Softwood and Hardwood)
Inch name	Sawed	Swedish	Australian
2 × 4	50 x 100 mm	45 × 95 mm	45 x 90 mm
1 × 3	25 × 75 mm	22 × 70 mm	19 x 70 mm
3 × 3	75 × 75 mm	70 × 70 mm	70 x 70 mm
2 × 7	50 × 175 mm	45 × 170 mm	Not used
2 × 3	50 × 75 mm	45 × 70 mm	45 x 70 mm
1 × 4	25 × 100 mm	22 × 95 mm	19 x 90 mm
1 × 5	25 × 125 mm	22 × 120 mm	19 x 120 mm
2 × 5	50 × 125 mm	45 × 120 mm	45 x 120 mm

Outside North America sizes of timber vary slightly. or 16/4

3-13/16?

3¾?

In North America sizes for dimensional lumber made from hardwoods varies from the sizes for softwoods. Boards are usually supplied in random widths and lengths of a specified thickness, and sold by the board-foot (144 cubic inches). This does not apply in all countries, for example in Australia many boards are sold to timber yards in packs with a common profile (dimensions) but not necessarily of consisting of the same length boards.

Also in North America hardwood lumber is commonly sold in a ?quarter?

Engineered Lumber

Engineered lumber is lumber created by a manufacturer and designed for a certain structural purpose. The main categories of engineered lumber are:

1) Laminated Veneer Lumber --- Generally called "LVL", they come in 1-3/4" thicknesses with depths such as 9", 11-7/8", 14", 16", 18", 24", and are typically doubled or tripled up. They function as beams to provide support over large spans such as removed support walls and garage door openings, places where dimensional lumber isn't structurally sound to use, and also in areas where a heavy load is bearing from a floor, wall or roof above on a somewhat short span where dimensional lumber isn't practical. This type of lumber cannot be altered by holes or notches anywhere within the span or at the ends as it compromises the integrity of the beam, but nails can be driven into it wherever necessary to anchor the beam or to add hangers for I-joists or dimensional lumber joists which terminate at an LVL.

2) Wood I-joists --- Sometimes called "TJI" or "Trus Joists", which are both brands of wood I-joists, they are used for floor joists on upper floors and also in 1st floor conventional foundation construction on piers as opposed to slab floor construction. Some I-joists are made with W-style webbing like a truss to eliminate cutting and allow ductwork to pass through.

3) Finger-Jointed Lumber --- Solid dimensional lumber lengths typically max out at lengths of 22' to 24', but is made longer by the technique of "finger-jointing" lumber by using small solid pieces, usually 18" to 24" long, and joining them together using finger-joints and glue to produce lengths that can be up to 36' long in 2x6 size.

Preservatives

Timber or lumber may be treated with a preservative that protects it from being destroyed by insects, fungus or exposure to moisture. Generally this is applied through combined vacuum and pressure treatment. The preservatives used to pressure-treat lumber are classified as pesticides; If left untreated, wood that is exposed to moisture or soil for sustained periods of time will become weakened by various types of fungi, bacteria or insects.

Miscellaneous

The term TIMBER! is used as a warning call to alert others working in the area that a tree is being felled and that they should take care to be out of the way.

References

Chronology

Key Dates:
1991: Q-Steaks Incorporated is started.
1993: Q-Steaks goes public.
1994: New York P. Bunyan's restaurants open.
1995: Company adopts the name Timber Lodge Steakhouse.
1998: G.B. Foods buys Timber Lodge.
2001: CKE buys Santa Barbara Restaurant Group.
2004: CKE sells Timber Lodge to T. Lodge Acquisition.

Additional topics

Company HistoryRestaurants

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