"Look out after" in the context of that sentence means to take care of someone. I wouldn't say it's a common collocation, but it might be depending on the region the speaker comes from (remember that different phrases and constructs are used amongst native English speakers in different countries or parts of a country). However, it's easier for me personally just to say "take care of (someone/something) or to say "look out for (someone/something)". By the way, be careful of how you write in English, punctuation is important and the sentence should be written: "They're your friends, they're just looking out after you."

I have never heard this phrase before. It looks like a mixture of two different phrases: They're looking after you. They're looking out for you. Is this from a transcript of spoken English, for example of an interview or reality TV? If it is, then it's simply a slip of the tongue in which the speaker accidentally mixed two phrasal verbs.

Normally it would be: "They're your friends; they're just looking out for you." - "they're just looking out after you" sounds wrong, and "they're just looking after you" is more if you're vulnerable, and they're a babysitter or something. When you say "collocation", are you talking about the "out after" bit? I've never heard the word "collocation" before, but it apparently means putting two things side by side? Perhaps you meant "colloquialism"? (Informal language) It's not normal (at least where I'm from) to say "look out after", but "look out for" and "look after" are. "Look out for" would be better in this scenario.