That is just Lichen. Lichen is a non-destructive, fungus and algae organism that is found on trees and shrubs, even rocks. It doesn't cause any harm to plants and actually serves many beneficial purposes in nature. You can read more about it on our webpage and there is also a short youtube clip at the bottom of the page.

The cause of decline to the azaleas is due to something else. If you would like to send us photos of the whole plant or some additional photos of the leaves, we could possibly help diagnose other problems. This year with the drastic cold snap in December, could be the cause of some leaf defoliation on the shrubs. You can monitor them in the spring with new growth and see if they leaf out again. Also look for any other signs or symptoms that may be causing stress. You can educate yourself on common azalea problems through our website and feel free to reach out with further questions should you notice anything. 

Emily