UPDATE 1-Fortress Paper Q3 profit tops Street

* Q3 adj EPS C$0.38 vs est. C$0.27

* Sales up 17 pct

Nov 9 (Reuters) - Canada's Fortress Paper Ltd (FTP.TO) posted a 52 percent rise in quarterly profit that beat expectations, helped by higher margin security paper sales at its Landqart mill and continued strong performance at its Dresden mill.

For the third quarter, the producer of security and specialty papers posted a net income of C$3.5 million, or 34 Canadian cents a share, compared with C$2.3 million, or 22 Canadian cents a share, a year earlier.

On an adjusted basis, it earned 38 Canadian cents a share.

Analysts on average expected earnings of 27 Canadian cents a share, before special items, according to Thomson Reuters I/B/E/S.

Sales rose 17 percent to C$51 million.

Shares of the British Columbia-based company closed at C$8.60 Monday on the Toronto Stock Exchange. (Reporting by Koustav Samanta in Bangalore; Editing by Unnikrishnan Nair)