Making money from TV usually means rooting around under your sofa cushions for loose change. That's not necessarily the case with PanAmSat (NYSE:PA). This leading provider of video satellite services is well-positioned to benefit from HDTV and already pays out a hefty dividend.

PanAmSat's financial reports may initially baffle individual investors attempting to research the company. Because of the structure of the business (and its considerable depreciation and interest expense), most analysts and fund managers will focus on EBITDA, not net income, as the key metric.

For the quarter, total revenue rose a bit more than 3%, with revenue from program distribution and video services up 10%. Adjusted EBITDA climbed 7.6% for the quarter, and the company managed to pay down more than $380 million of debt. While EBITDA and operating income growth in the small government business was up modestly, growth was more robust in the core fixed satellite service business.

PanAmSat also recently signed two agreements that should boost its fortunes. Alcatel (NYSE:ALA) sold the company its Europe*Star business for $70 million in cash. This gives PanAmSat one satellite in orbit and two valuable slots that cover Europe, the Middle East, Africa, and parts of Asia and India. Based on the purchase price, the deal should be accretive from the moment it closes.

The company also reached an interesting agreement with Asian satellite operator JSAT, which will build a new satellite for the U.S. market, with PanAmSat splitting the costs. JSAT will pay all the upfront expenses, and PanAmSat will be able to kick in its share at very favorable terms.

PanAmSat certainly isn't a disaster-proof way to pocket a big dividend. Operating in space has certain unique risks. What's more, the company will have to walk a tight line between repaying debt, maintaining sufficient capital expenditures to grow the business, and upholding its commitment to paying its dividend. I'm fairly confident that management will pull this off successfully, but investors should still be aware of the challenge.

While other satellite companies might go public (most are privately held by investment groups right now), I like PanAmSat's dominant position in television. Customers such as News Corp. (NYSE:NWS), Sony (NYSE:SNE), Viacom (NYSE:VIA), Disney (NYSE:DIS), and Time Warner (NYSE:TWX) are solid customers, and ongoing growth in HDTV should continue to support PanAmSat's healthy dividend.

Down-to-earth takes on satellites:

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).