Simulation behaves differently in Proteus vs Icircuit
Your circuit is working, believe it or not. How do I know? I created your exact circuit on my copy of Proteus. However, I did it with one small difference. 

If you go to the "System" tab, then "Set Animation Options" you can tick the box that says "Show Logic State of Pins?"



What this will do is show blue and red boxes at certain points in the circuit:



So, you will see that your output is indeed toggling, but the LEDs aren't turning on. Why is this? Well, the properties of the standard LEDs in proteus need a minimum current to turn on. You just don't have enough. Change the value of resistors R3 and R4 and you'll find the LEDs turn on fine. 

              

If you find this doesn't solve your problem, I would move R4 and double check that it is indeed connected to the rest of the circuit. Putting the ends of components together on Proteus doesn't physically join them. You need to make the connection first, then move the part.