You need to make sure that there is room for both the tool, leads and stock to leave. Try turning off Stock to Leave, Lead-in and Lead-out.
Alternatively try using the Bore or Circular operations.
You may also find the warnings in the Log useful. If there is not enough room for the leads, you should get a warning like this:
Warning: A contour was not machined because the given lead parameters would cause a collision!
Click the orange triangle in front of the operation to show the log. Or right-click and choose Show Log.
/Mark
