The National Water Supply and Drainage Board earned no revenue on nearly a quarter of the water it put into its network in the first half of 2026, according to the Finance Ministry’s mid-year fiscal report.
Non-revenue water stood at 24.4 percent for the six months to June, the Daily Mirror reported, citing the report. That is marginally worse than the 24.2 percent recorded in the same period of 2025.
Non-revenue water is water that is produced and distributed but never billed. It arises from leaks in the distribution network, illegal connections, metering inaccuracies, and connections that are authorised but go unbilled.
The numbers
| Indicator | 1H 2026 | 1H 2025 |
|---|---|---|
| Non-revenue water | 24.4% | 24.2% |
| Revenue | Rs 43.6bn | Rs 41.5bn |
| Cost of sales | Rs 16.5bn | Rs 15.0bn |
| Gross profit | Rs 27.1bn | Rs 26.5bn |
| Net profit | Rs 16.2bn | Rs 17.7bn |
| Average unit cost | Rs 88 | Rs 82 |
| Water production | 440.8m m³ | 419.1m m³ |
| Water sales | 333.5m m³ | 317.6m m³ |
Revenue rose 5.1 percent to Rs 43.6 billion. But the cost of sales climbed roughly 10 percent to Rs 16.5 billion, which the report attributes mainly to higher pumping costs, rent, rates and other taxes.
The result was a gross profit of Rs 27.1 billion, slightly up on the year, but a net profit of Rs 16.2 billion — a fall of 8.5 percent from Rs 17.7 billion. The average unit cost rose by Rs 6 to Rs 88.
Production and sales each grew about 5 percent, to 440.8 million and 333.5 million cubic metres respectively. The gap between those two figures is the non-revenue water.
Connections and coverage
The Board added close to 60,000 connections in the six months, taking the total to 3.31 million at the end of June.
Reported coverage fell on both measures — piped water supply to 62.8 percent from 63.7 percent, and safe drinking water to 94.5 percent from 99.1 percent. The report attributes this to a change in method rather than a loss of service: coverage was reported on a household basis in 2025 and on a population basis in 2026. The two series are therefore not directly comparable.
Piped sewerage coverage edged up to 2.11 percent from 2.08 percent.
The Board completed two projects in the period, and the General Treasury provided Rs 5.9 billion in equity capital to fund loan repayments and the completion of major water supply projects.
Context
Water losses have been a long-standing issue for the utility. A National Audit Office report earlier this year found the Board had no formal water tariff policy and criticised management weaknesses behind tariff increases. The Board is also pursuing three desalination projects to add supply.
Sourcing note
This article rests on a single verified source. The Daily Mirror says it has seen the Finance Ministry’s mid-year fiscal report; the document itself has not been published by this desk’s other monitored newsrooms, and a search of EconomyNext, the Daily FT, Island and Lanka Business Online returned no independent filing on these figures. The numbers above are as reported by the Daily Mirror.
Not reported
The report as described does not say what the Board is doing to reduce non-revenue water, what target it is working to, or how the 24.4 percent breaks down between physical leakage and commercial losses such as illegal connections and meter error. It gives no regional breakdown, and no NWSDB or ministry official is quoted.