Joy Global (NASDAQ: JOYG) is set to report its earnings on March 4. The mining equipment manufacturer has indicated weakness in business in its last quarter results itself, despite having reported a healthy quarter last time. The major factor that affects the company’s finances are order cancellations. Joy Global make the one of the world's largest mining machines, including electric mining shovels that can lift 100 tons in a single scoop and draglines where the bucket alone is the size of a two-car garage. Machines that cost tens of millions of dollars each are ordered many months in advance. With only a few of the largest machines built a year, even a couple of order cancellations could be harmful to an equipment company. Joy Global recently had an order from Russia canceled after the buyer ran into credit problems."We know there are backlogs that are not totally bulletproof because they are ultimately based on the creditworthiness of our customers," Joy Global CEO Michael Sutherlin said in a Dec. 17 teleconference with analysts. BHP Biliton, the world's largest mining company, sees global mining billion and industry capital expenditures falling 47% in 2009 to $62 billion in 2010. falling another 16% to $52.

Joy Global sees its demand in China to bring in good turnover in its business. There is no doubt that the private companies are shying from infrastructure spends but the government spending meant to boost the ailing economies should benefit companies such as Joy Global. Joy Global has three facilities in China and is moving into a new plant after acquiring a Chinese manufacturer in 2008. Its wholly-owned China Mining Machinery subsidiary has completed the acquisition of 100% of the outstanding shares of Wuxi Shengda, a Chinese manufacturer of longwall shearing machines, for $22.0 million excluding closing costs. Wuxi Shengda provides the Company with a foothold in the China market for domestic equipment to better serve that country’s local and regional mining industry.

The board declared a quarterly dividend in the amount of $0.175 per share to be paid on March 19, 2009 to shareholders of record on March 5, 2009. In a separate development, as per a settlement announced recently, workers displaced from the 2005 closing of the Joy Mining Machinery plant in Mount Vernon are finally eligible for benefits. Claims to the U.S. Department of Labor were first filed when the facility closed. After three years in a U.S. court of international trade, the workers are now eligible for Trade Adjustment Assistance and Alternative Trade Adjustment Assistance.

Earnings Estimates
Current Estimates: $0.75
Number of Estimates: 13
High Estimate: $0.85
Low Estimate: $0.60
Last Year EPS: $0.64
Percentage Growth: 18.00 %

Disclosure: The author does not own any of the stocks mentioned above.