Market Efficiency Question

At the start of the year a friend bought stock in 3 companies. At the end of the year they sold all of them, with a net return of 18% for the year.

Compared to the average stock return of 12.5% in a national equity index for the same period, their investment performance was much better.

This person told you, quite confidently, that "The old rules don't apply anymore. Market efficiency means nothing, for a smart investor." Did they beat the market? Was their impressive investment performance a violation of market efficiency? Explain