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UPDATE 1-Lumber Liquidators' shares soar on first profit since 2015 scandal

(Adds CEO quote, background; updates shares)

Aug 1 (Reuters) - Shares of Lumber Liquidators Holdings Inc soared as much as 31 percent on Tuesday after the U.S. hardwood flooring retailer posted its first quarterly profit since a 2015 product-related scandal dented sales.

Shares of the company hit a more than two-year high of $32.50 in morning trading.

Toano, Virginia-based Lumber Liquidators reported a net income of $4.5 million, or 16 cents per share in the second quarter ended June 30, compared to a loss of $12.2 million, or 45 cents per share, a year earlier.

Lumber Liquidators has suffered several quarters of losses after a report in March 2015 alleged that its flooring products sourced from China contained high levels of formaldehyde, a cancer-causing chemical.

Since then, amid lawsuits from investors and investigations by federal agencies, Lumber Liquidators has shuffled senior management and worked to improve product quality.

Sales at Lumber Liquidators' stores open for more than a year rose 8.8 percent in the second quarter, beating analysts' average expectation of 5.8 percent, according to Consensus Metrix.

The company benefited from better pricing, a wider product assortment and a sharper focus on training and marketing, Chief Executive Dennis Knowles said.

"Although we are pleased with the results in the quarter, we still have work to do," Knowles said in a statement.

The company also said the U.S. Consumer Product Safety Commission (CPSC) would stop monitoring Lumber Liquidators' distribution of test kits to customers who bought its Chinese laminates. The kits are meant to screen formaldehyde levels in people's homes.

The CPSC last year prohibited the company from selling its inventory of laminates sourced from China, which resulted in about 22 million board feet of flooring remaining unsold.

Lumber Liquidators' shares, which have climbed 57 percent this year through Monday, were up 29.8 percent at $32.07. (Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Sai Sachin Ravikumar)