Global construction machinery giant Caterpillar (CAT) was down on Wednesday as the company’s earnings report reflected a slump in sales resulting from a slowdown in the mining sector and lower growth from emerging markets in general, falling far short of expectations.

For the second quarter, Caterpillar netted $960 million, or $1.45 per share on revenue of $14.6 billion, compared to the prior year period during which the company made $1.70 billion, or $2.54 per share on revenue of $17.4 billion. Analysts had expected a significantly larger earnings-per-share figure of $1.70, and revenue of $14.9 billion.

Furthermore, while analysts had expected a full-year 2013 profit of $6.81 per share on sales of $58.6 billion, the company cut its forecast for 2013, saying it expects to earn $6.50 per share on earnings of between $56 and $58 billion. Caterpillar grossed $65.9 billion in 2012. The company had previously already cut its forecast after the first quarter’s disappointing earnings report.

Sales figures were the most disappointing in the Asia-Pacific region, down 25 percent on the prior year period, with mining companies cutting spending in Australia, the world’s biggest exporter of iron ore and coal, and unexpectedly slow growth out of China that has put a hold on construction projects.  Sales were also down 14 percent for Latin America, and 9 percent in North America.

Last week, mining industry leaders Rio Tinto Plc ($RIO) and BHP Billiton Plc ($BBL) watched their stocks jump after both released impressive earnings reports that saw an increase in the production and sale of both iron ore and copper. But both companies have also been cutting costs and scaling back operations, part of a larger recent phenomenon within the industry as growth out of emerging markets puts on the breaks. Barrick Gold Corp. (ABX) and Freeport McMoran Copper & Gold Inc. (FCX) , respectively the largest gold and copper miners, have both canceled projects and cut capital spending as well, and Caterpillar is feeling the hurt from these contractions.

Last week also saw legendary short-seller Jim Chanos telling investors that they should short the company. The move made headlines but was not surprising from a fundamental standpoint, as this is Caterpillar’s third consecutive ugly earnings report, and the economic crunch in emerging markets has hurt the mining industry into which the company has invested a great deal over the past few years.

Despite the bad news, chairman and CEO Doug Oberhelman, remained positive, and while admitting to CNBC that there is “no question there’s a slowdown,” and going on to say that over the longer-term, mining is good place for the company to be. Shares were off 3.15 percent to $82.83 in midday trading. Caterpillar is 3.3 percent in 2013, but has declined more than 11 percent in the last six months.

[Image: A Caterpillar tractor on site in Nancy, France 2010. Courtesy of Fotopedia]