Net assets per share meaning

In practice, net assets per share expresses the balance‑sheet value of a company attributable to each ordinary share. It is typically calculated as net assets (total assets minus total liabilities) attributable to equity shareholders, divided by the number of ordinary shares in issue at the measurement date, usually excluding treasury shares. Some disclosures also present a diluted figure assuming conversion of in‑the‑money options or other dilutive instruments. This is not a term defined in legislation or case law; it is a descriptive financial metric used across legal and transactional contexts in England & Wales, Scotland, Northern Ireland and Ireland under IFRS or local GAAP. For investment companies, it is commonly called net asset value (NAV) per share. Typical uses include company reports and circulars, listing disclosures, M&A valuation materials and finance covenants. It is a key indicator of whether the share price trades at a discount or premium to asset backing. A share buyback reduces shares in issue and can increase net assets per share, which may in turn support the market price. Compare with earnings per share (EPS), which measures profit per share over a period.